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Chip and Pin fraud is up 50% Since the introduction of chip and pin system that was supposed to cut down card frauds, it had leapt up almost as 50%, hitting a total record high as £609.9m in 2008, which was 14% up on previous year. The figure was increased by £182.8m – 43% - since the chip and PIN system became universal on Valentine's Day in 2006. According to figures, fraud linked to counterfeit or cloned cards hit £169.8m in 2008. That was up by 18% on 2007 and by 75% compared to 2005. An investment of more than £1billion were made in new till machines to introduce the chip and PIN system, under which payments are authorised with a four-digit code (rather than a signature). Also, in order to cut down severely the debit and credit card frauds, a huge cost is passed on by credit card providers to shoppers on the basis of higher bills. Earlier, PINs were used at some 50,000 bank cash machines, but now there are more than 900,000 tills, including high street stores and restaurants. The reality is that it has provided facility for criminals in the cloning of cards, ie. to steal the PINs and the information on the magnetic strip, which are needed to create copies. While card frauds are on the increase, many of the big banks are taking a tough line with victims and are refusing to pay refunds to them. In the meantime, Home Office has decided that it is no longer the job of the police to record and investigate card fraud and police forces are now directing victims to their banks, rather than conducting investigations. Criminals also have found ways to access the web bank accounts of victims to steal their cash. According to Banking Industry Trade Body, APACS, has seen a 132% annual rise in theft linked to online banking. It said online banking fraud rose last year to a total of £52.5m. Most often this is done by criminals, sending out emails, purporting to be from a person's bank, directing them to a bogus site where their access passwords are stolen. Criminals also implant spying software - malware - on the computers of their targets. Security expert Professor Ross Anderson, of Cambridge University's Computer Lab says, the government’s decision to switch reporting of card fraud from the police to the banks is a mistake and totally unwarranted privatisation of the justice system, which means that people just cannot get these crimes investigated.