CHARLOTTETOWN — Criminals in Canada have become increasingly adept at using the power of plastic, particularly debit cards, to commit financial fraud, an annual report released Friday has found.
The Criminal Intelligence Service of Canada, which represents nearly 380 law enforcement agencies across the country, concluded that organized crime groups have adapted to advances in technology aimed at preventing fraud.
“More activities now are with respect to debit cards as opposed to credit cards,” RCMP Commissioner William Elliott, chairman of the CISC, told a news conference.
“We’re seeing some positive developments within the marketplace with regard to chip and pin technology, but it is certainly a very serious problem.”
Statistics provided by the Canadian Bankers Association shows combined annual losses due to debit and credit card fraud in Canada exceeded $500 million in 2008.
The bulk of credit card fraud losses are attributed to counterfeiting and fraudulent purchases, suggesting an increase in organized criminal operations, the report said.
Hackers are targeting online sites and using malware and keystroke-logger programs to steal credit card data — a trend likely to increase as online banking continues to grow in popularity, the report added.
“The criminal element responds to market demands and the realities of the changing environment,” Elliott said.
“People now less and less use cash, and the criminal element migrates to that as well. There are shifts in the way criminal activity is carried out.”
Federal Public Safety Minister Peter Van Loan acknowledged that combating financial crime has been a challenging task with constantly evolving technology.
“With changing technology, of course, we continue to always have challenges in keeping pace with crime, particularly financial and organized crime,” Van Loan said in an interview.
“The providers of financial services ... are also very involved in improving that technology so that they can get better at it. We just have to continue to work on cracking down on that kind of crime.”
Credit card fraud is especially prevalent in the urban areas of Quebec, Ontario and British Columbia, the report said.
It also found that there are about 750 criminal groups operating in Canada — a slight decline from last year.