Stay up to date with notifications from The Independent

Notifications can be managed in browser preferences.

Money: Travellers stranded by card cancellations

Travel sickness: a Frizzell's holiday insurance advert helped establish its travel credentials. But the firm has been hit by credit- card fraud Photograph: UNS PHOTOS

Steve Lodge
Sunday 30 November 1997 00:02 GMT
Comments

Your support helps us to tell the story

From reproductive rights to climate change to Big Tech, The Independent is on the ground when the story is developing. Whether it's investigating the financials of Elon Musk's pro-Trump PAC or producing our latest documentary, 'The A Word', which shines a light on the American women fighting for reproductive rights, we know how important it is to parse out the facts from the messaging.

At such a critical moment in US history, we need reporters on the ground. Your donation allows us to keep sending journalists to speak to both sides of the story.

The Independent is trusted by Americans across the entire political spectrum. And unlike many other quality news outlets, we choose not to lock Americans out of our reporting and analysis with paywalls. We believe quality journalism should be available to everyone, paid for by those who can afford it.

Your support makes all the difference.

A credit card firm specialising in cards for people who travel abroad a lot is paying compensation totalling tens of thousands of pounds after it cancelled 3,000 cards virtually overnight, leaving some travellers without working cards and funds.

The small Bournemouth-based Frizzell Bank cancelled the cards after uncovering a range of fraudulent transactions in the Far East and fears that fraudsters would be able very quickly to counterfeit a series of cards.

The large-scale cancellation earlier this month was described as highly unusual by some rivals and "embarrassing, particularly at this time of the year". The run-up to Christmas is a peak period for credit-card use.

All affected cardholders are having their pounds 11 annual fees refunded. Some customers left high and dry abroad have been paid individual compensation of up to pounds 150. Cardholders have been sent letters telling them that their old cards have been cancelled and will not work, and by now should have received replacement cards. The fee refunds will follow in subsequent statements, the bank says.

Hugh Baird, group banking director at Frizzell, said cancelling so many cards was justified and happened more often than card companies admitted. "It's like losing a bunch of keys. You have to change all the locks." The bank said it had tried to contact cardholders by telephone the day it moved to cancel the cards.

Mr Baird conceded that a small number of cardholders who were travelling had had difficulties when their cards were cancelled without warning, and these individuals were given personal compensation.

Cardholders have been warned to look out for unauthorised transactions on future bills and told they will not be held liable for these costs. The pounds 11 fee refund reflected the "inconvenience", said Mr Baird.

The Frizzell Bank Visa and Mastercards can be attractive to people who travel a lot because they offer a better exchange rate on transactions than virtually any other card. Most cards "load" underlying exchange rates by up to 3 per cent (although this is still better than buying local currency from a bureau de change), but Frizzell has no loading, making purchases up to 3 per cent cheaper than with other cards. The Frizzell cards can also be good value for withdrawing local currency from cash machines.

The Frizzell frauds stemmed from the electronic copying of information stored in the magnetic strips of genuine cards, and replicating other cards by experimenting with number sequences. Apacs, a body representing card issuers and companies involved in payment systems, said this electronic counterfeiting, or "skimming", was a growing area of card fraud.

Most card companies rarely hold individuals liable for the cost of fraudulent transactions not their fault, although some reserve the right to charge up to pounds 50, and people have been asked for higher repayments where they are deemed to have been "grossly negligent", such as where a holder has written a PIN number on a card that is then stolen.

Card companies are now testing computer chips on cards, in the hope that these will be more secure than the present magnetic strip technology.

Join our commenting forum

Join thought-provoking conversations, follow other Independent readers and see their replies

Comments

Thank you for registering

Please refresh the page or navigate to another page on the site to be automatically logged inPlease refresh your browser to be logged in