EC Report Stresses Importance Of Payment Security

by Ulrika Lomas, for LawAndTax-News.com, Brussels

01 May 2008

The European Commission announced on Monday that it has published a report on actions undertaken with regard to the prevention of payment fraud between 2004 and 2007.

According to the EC, the report showed that the security of means of payment and payment systems is a necessary condition for improving consumer confidence and trust in new payment services.

From a regulatory point of view, the security of means of payment has been addressed in recent legislation, namely in Payment Services Directive, and also the third Money Laundering Directive by means of the "know your customer" obligations, the Commission explained.

The development of the Single Euro Payments Area (SEPA) also aims to provide an opportunity to build on the legislative framework, to increase both security and trust.

Internal Market and Services Commissioner Charlie McCreevy observed that:

"Payment fraud affects consumer confidence in non-cash means of payment and therefore remains a threat to the success of the single market for payments. The Commission is working actively to minimise the payment fraud threat, for the benefit of consumers and financial services providers alike."

The EC announced in its statement on Monday that:

"Payment fraud is a moving target and, inevitably, new threats appear, such as identity theft/fraud and, more generally, cyber crime. In 2007, the Commission announced its policy objectives regarding cyber crime and will continue to closely monitor developments in this area."

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