We cover a lot of credit card fraud news in the LPM Insider. It’s a natural topic for a readership heavily concentrated in retail and retail loss prevention. But the statistics keep changing, as do some of the suggestions to help protect yourself. So, an update and review every so often is beneficial.
The continually evolving credit card fraud news:
- The latest Nilson report estimates that in 2016, worldwide credit card losses topped $24.71 billion.
- Barclays reports that 47 percent of all credit card fraud occurs in the United States.
- Fifty-six percent of Mexico residents reported being a victim in 2016.
- Only 8 percent of Hungarians reported being victims in the past 5 years. In general, European countries have the lowest fraud rates due to the early adoption of EMV (chip) cards.
- Javelin Strategy reports that there is an identity theft incident every 2 seconds, many involving credit card fraud.
- ACI Worldwide estimates that 47 percent of Americans have been a victim of credit card fraud in the past 5 years.
- Florida topped all states with over 300,000 fraud complaints reported to the Federal Trade Commission (FTC) in 2015, while North Dakota had the fewest.
- Older Americans are more likely to become victims of credit card fraud. According to the FTC, 65 percent of all complaints in 2015 involved victims over 40 years old.
- Women topped men as victims in 2014, but only by 11 percent.
- Approximately 65 percent of credit card fraud victims suffer a real or indirect financial loss resulting from an incident.
- The vast majority of credit card fraud occurs for purchases online or over the phone.
- Approximately 37 percent of all credit card fraud in the United States is related to counterfeit cards.
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Eliminating Signature Requirements?
Given these disquieting credit card fraud news updates, it’s ironic that Mastercard, Discover, American Express and Visa have recently announced that they will no longer require signatures for most credit card transactions. Austen Jensen, the vice president for government affairs for the Retail Industry Leaders Association (RILA), pointed out that retailers have long argued that signatures are “a costly yet feeble means of securing transactions.”
Further, industry leaders don’t think no-signature policies will endanger cardholder data. Jaromir Divilek, executive vice president of global network business at American Express, notes that the company’s “fraud capabilities have evolved to the point that we can now eliminate this pain point for our merchants”
As we all know, merchants don’t typically check a cardholder’s signature against the signature on the back of the card anyway.
We Still Need to Protect Ourselves
OK, so fraud detection tools have advanced, and even signatures are no longer needed. But every consumer needs to be cautious and know how to protect themselves from becoming a victim. Here are some tips:
Protect your privacy. Shred pre-approved credit card offers. Keep your purse or wallet in a safe place at work, at the gym, or while in your car. Use passwords for all devices and use a password-keeper program or app. Never write them down.
Use zero-liability credit cards. It’s becoming more common for credit card issuers to provide fraud protection or zero liability for the cardholder when it comes to unauthorized purchases. Make sure your cards have these features.
Monitor your accounts often. Federal liability protection requires that you report any fraudulent charges within sixty days. Check on your accounts at least every few days.
Use common sense when shopping online. Be sure your wireless network is secure. When paying online, make sure that website is secure. Look for the “https” at the beginning of the website address indicating that data sent between your browser and that site are encrypted.
Choose credit, not debit. Use credit cards whenever possible. Protection against fraud on credit cards is more secure. If fraudsters access your bank account from a debit card, they can clean it out quickly.
Protect your mail. Stop service through the post office when you leave town. It’s easy and free, but be sure you do in person or on the official USPS site. Don’t post vacation plans on social media. And mail items using a postal box, not with the flag up on your mailbox.
As we’ve always said, a healthy dose of paranoia goes a long way to keep you safe. Be careful out there.
This post was originally published in 2018 and was updated November 1, 2018.