Rugby World Cup fraud warning

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New Zealand is tipped to become a target for scammers during the next five weeks as a surge in electronic payments during the Rugby World Cup makes it more difficult for banks to detect fraudulent transactions, a electronic network security company says.

The warning comes just months after retailers were forced to upgrade their terminals amid rising fraud and to meet global security standards in time for the Rugby World Cup.

The new terminals can read chip enabled cards and are more secure because they cannot be copied as easily as magnetic strip cards.

However Simon Gamble of network management company Mako Networks says they are not foolproof.

"In theory chip should be more secure but if someone has swapped one out they can tamper with the chip reader so it doesn't work anymore which means the retailer has to fall back on the mag(netic) stripe."

Gamble said while banks would have ramped up staff levels to detect fraud during the tournament, the sheer volume of transactions would make it difficult to identify all fraudulent transactions.

"They are fighting a losing battle really, but they will be doing the best they can to minimise the impact."

Overseas tourists pumped an extra $2.8 million dollars through the retail network during the first few days of the Rugby World Cup than they did at the same point last year, official figures from Paymark show.

"Everything points to the fact fraudsters would be operating during the world cup. You've only got to look at what happened during the Football World Cup in South Africa and other major sporting events," Gamble said.

Visa's director of country risk management Ian McKindley said the New Zealand public should expect to see a small increase in fraud during the tournament, as would be expected with any major sporting event.

Last year's Football World Cup in South Africa was a haven for fraudsters who fitted skimming devices and pinhole cameras into automatic teller machines, and it was possible this type of fraud could occur during this year's cup, McKindley said.

McKindley said although Visa card fraud had increased to nearly 5c in every $100 last year, from 4c in every $100 previously, New Zealand still had one of the lowest rates of of fraud, in the world.

"Over 80 per cent of all card transactions in New Zealand are vertified by the use of a pin which is terrific, but you need to protect your pin.

"My other advice is that you make sure your bank has up to date contact details for you. New Zealand banks have invested heavily in state of the art fraud detection systems. They are monitoring 24/7 and if they do see anything suspicious they want to be able to contact you immediately."