Our website uses cookies

Cookies enable us to provide the best experience possible and help us understand how visitors use our website. By browsing Essential Retail Magazine, you agree to our use of cookies.

Okay, I understand Learn more

Online fraud in focus at Labour Party Conference

Cybercrime and more specifically online fraud was a hot topic this week, with shadow home secretary Yvette Cooper vowing that a Labour government would provide leadership in addressing the issue.

In her speech at the Labour Party Conference on Wednesday 25 September, Cooper said that the current government "hasn't got a grip" on internet fraud and proposed a law change to make it easier to prosecute identity theft.

"We'll change the law to make it easier to prosecute identity theft," she explained to her fellow party members. "A new Police First programme – modelled on Teach First – to get the brightest IT graduates into policing.

"And Peter Neyroud, former top chief constable has agreed to work with us, consumer watchdog Which? and business to build an organisation to challenge online fraud, modelled on the successful Internet Watch Foundation which is tackling online child abuse worldwide."

With the UK retail industry rapidly become more digitally active, it could be argued that cybercrime will naturally become more of a problem for the sector as the years go by. It is already a major area of focus for retailers nationwide.

The Centre for Retail Research estimated last year that retailer losses from cybercrime totalled approximately £240 million, but that does not include customer losses except where retailers have paid compensation to customers.

Meanwhile, the most recent British Retail Consortium (BRC) Retail Crime Survey indicated that e-crime accounted for 37% of the total cost of crime in the industry in 2011-12. The main elements contributing to the cost of retail e-crime were said to have been identification-related frauds, card and card-not-present and refund frauds.

So would Labour's proposals be welcomed by the retail industry?

Professor Joshua Bamfield, director at the Centre for Retail Research, this week supported Cooper's proposal "in general terms", but told Essential Retail that it is important to provide more thorough definitions of identify fraud if the crime is to be addressed properly.

"English law finds it hard to keep up with cyber change, and the definition of identity theft is very hazy," he explained.

"These days, individuals often claim any cyber/financial/scam as ID theft, which cannot be right. We did some work a few years back which showed that even theft of credit cards in the post was seen as ID theft. So there is an issue of precision here."

Bamfield defines ID theft as being the taking over of a personal account or business, using Companies House, and he suggested that it is a positive move by Labour to start considering these issues. However, he questions whether the police will have the capacity to really focus on the subject.

He commented: "The suggestion of smart young coppers specialising in this form of fraud is excellent, but the police do not work like that – you cannot go into a specialised squad until you have done your bit as a raw recruit in a police station."

The UK's fraud prevention service CIFAS recently appointed a new CEO to oversee the battle against fraudulent activity, and the retail industry will be working very closely with new incumbent Simon Dukes in the coming months to find solutions and combat the problem.

Maxine Fraser, national operations director for retail intelligence organisation Retailers Against Crime, which works alongside CIFAS on behalf of retail, said recently that it is vital for the industry to share its experiences as that will be a key factor in raising awareness and clamping down on criminals.

Many of the subjects surrounding retail cybercrime, as well as the wider instances of theft in the industry, will be addressed at next week's BRC Retail Crime and Loss Prevention event in central London.

Keep an eye on Essential Retail next week for further coverage of the main themes.