More than 76 million cards are now Chip and Pin

Cheque fraud rose 50% in the first six months of 2004, compared with the same period in the previous year.

The cost of the fraud totalled �24.3m, according to figures from the British Bankers' Association (BBA).

The Association for Payment Clearing Services (Apacs) said cheque fraud may have risen as a result of a crackdown on card fraud.

Fraud prevention

In 2003 - the latest complete year for which figures are available - 41,000 forged, counterfeit or altered cheques were passed, potentially costing �566m.

Many of these attempts were foiled, but actual losses still exceeded �45m.

It would be nice if they [fraudsters] could pack up their bags and go home Sandra Quinn

Apacs is rolling out Chip and Pin, a new fraud-prevention system, where users verify their identity with a four-letter pin rather than a signature.

So far, more than 76 million cards have been issued to UK households.

"It would be nice if they [fraudsters] could pack up their bags and go home, but they are unlikely to and, unfortunately, they will go to another area that is vulnerable," said Sandra Quinn, an Apacs spokesman.

Apacs does not expect an immediate cut in card fraud over the next twelve months, as a result of the new Chip and pin cards.

"We are hoping for containment," said Ms Quinn.

She expects card fraud to have reached �500m in 2004, when the final fraud figures are published shortly.