Company News • 24.08.2012
E-Crime Costing UK Retailers £200m A Year
The most expensive was personal identification-related frauds
Retailers have called on the Government and police to take e-crime more seriously as a new survey showed the problem costs UK firms £205.4m a year.
The figure includes £77.3m in losses in 2011-12 from fraud itself, £111.6m due to legitimate business being rejected because of crime-prevention measures and £16.5m spent providing better security.
The UK is seen as a world leader in online retailing - it has the biggest internet spend per-capita of any country and 11% of global internet retail sales.
But many retailers lack confidence in the official response to e-crime, which is the biggest emerging threat to the retail sector, according to the British Retail Consortium (BRC).
Of those questioned in the BRC's first e-crime survey, 60% of firms said it was unlikely they would report any more than 10% of e-crimes to police.
In proportion to the total value of sales, e-crime is twice as costly as overall retail crime.
At £205.4m, e-crime represents 0.75% of the £28bn of online retail sales in 2011. The £1.4bn cost of retail crime as a whole is 0.36% of the £303bn value of all retail sales.
The most expensive type of e-crime for retailers was personal identification-related frauds. These produced £20m of losses in 2011-12.
Card fraud was in second place, with £15m losses to retailers during the same period. Refund frauds were responsible for £1.2m in losses.
Other categories of e-crime which are a particular problem for UK retailers, but harder to quantify, include phishing (bogus websites).
After the US, UK brands and companies are the second most targeted in the world.
The BRC is calling for consistency on reporting, recording and investigating e-crime across the country and more police resourcing to be directed to e-crime.
BRC director general Stephen Robertson, said: "The rapid growth of e-commerce in the UK shows it offers great benefits for customers but also new opportunities for criminals. Online retailing has the potential for huge future commercial expansion but Government and police need to take e-crime more seriously if the sector is to maximise its contribution to national economic growth."