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Own-Goal: card issuers' fraud detection software can leave holidaymakers stranded

As we have become increasingly reliant on our credit and debit cards, we have unwittingly created a whole new industry - credit card fraud. Card fraud has jumped from £189 million in 1999 to a massive £411 million in 2001 and this huge increase is largely due to card 'cloning' - obtaining someone's card details and then putting them onto another card, which is then used to spend their credit limit. In effect, two cards exist with exactly the same details on the magnetic stripe on the back of the card.

The Government has promised action to reduce this by introducing a new 'chip-card and PIN number' system but it isn't due to be in place until 2004 or 2005. In the meantime card issuers are fighting back by using complex software programmes to monitor card activity and look for possible fraudulent transactions. These programmes identify unusual transactions on your account - places you wouldn't normally visit or amounts in excess of your usual spending patterns. When they spot possible fraud, your card can be blocked in a matter of seconds and the transaction refused.

This sounds pretty positive but, what if you're the one using your card? Perhaps in that expensive gift shop in Orlando or maybe checking out of your hotel in Corfu - and the transaction is refused? Your first reaction will be to assume it's a mistake and there must be a problem with the connection to the card issuer. So you'll ask the retailer to process the transaction again and you'll get the same result.

By the third time your card has been refused, you're going to be pretty angry as well as a little embarrassed but you now have another problem - how are you going to pay? You can use another card, if you have one - but staff may be a little wary about accepting it. You can contact your card issuer and try to sort the problem out - but what's the number and whose phone are you going to use?

Here's one suggestion to help you avoid this problem in the first place. Before going away, contact your card issuers and let them know when and where you'll be going. They will put a note on your file so their fraud detection programmes won't flag up your holiday spending as suspicious. Remember, if you do happen to then change your plans, let your card issuers know so they can amend their files accordingly.

Some card issuers don't operate these 'early advice' systems but it is advisable to contact them anyway. Barclaycard, the market leader, is in the process of introducing a system to enable cardholders to let them know when they are planning to go abroad.

It might seem a bit over the top and it does put the responsibility onto you but we hope you'll agree that prevention is better than cure.


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