Electronic crime cost the UK retail sector £205 million pounds, or 0.75% of all online sales, according to new figures from the British Retail Consortium.
The BRC identified three kinds of online fraud that caused £77.3 million in direct costs to retailers in 2011. These were identification-related fraud, such as hijacking customer accounts, which cost retailers at least £20 million; card and card-not present fraud, which cost them £15 million; and refund fraud, which cost £1.2 million.
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Retailers spent a further £16.5 million on security measures for protecting customers against e-crime, and the BRC estimates that another £111.6 million by customers put off purchasing by fraud-prevention measures.
In other words, fraud prevention is currently costing businesses more than fraud.
The figures come from a survey of retailers representing 45% of retail spend in the UK.
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."
Robertson suggested that the government and law enforcement community should with with its members to develop a new centralised method for reporting e-crime offences in a bid to encourage retailers to report more offences.
“Retailers are investing significantly to protect customers and reduce the costs of e-crime but the law makers and enforcers need to show a similarly strong commitment,” he said.
