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E-crime costs retailers £205.4 million in a year

E-crime is the biggest emerging threat to the retail sector as the rapid growth in e-commerce in the UK sees new ways of shopping being accompanied by new types of crime.

The British Retail Consortium’s (BRC) first e-crime study is the first comprehensive survey assessing the make-up and scale of e-crime. It estimates the total cost to retailers in 2011-12 was at least £205.4 million. That includes £77.3 million in losses from frauds themselves as well as prevention costs and legitimate business lost as a result of those measures.

The most expensive type of e-crime for retailers was personal identification-related frauds. These produced £20 million of losses in 2011-12. Card fraud was in second place, with £15 million losses to retailers during the same period. Refund frauds were responsible for £1.2 million 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 USA, UK brands and companies are the second most targeted in the world.