Credit Card Fraud News: 2018 Update
The credit card fraud news and statistics keep evolving–and not necessarily in a good way.
By Bill Turner, LPC
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.
Credit Card Chip Technology Has Been Effective at Reducing Fraud. But…
… there are downsides. Developments are underway to plug the holes caused by the side effects of credit card chip technology.
By Bill Turner, LPC
We know that the United States was late in adopting widespread use of EMV (chip) credit cards. Finally, in 2015, we began catching up to the rest of the world when it came to the implementation of credit card chip technology. The results have been positive.
According to Visa, counterfeit credit card fraud dollars at US merchants that completed the chip upgrade dropped 76 percent between December 2015 and December 2017. The number of US merchants accepting chip cards jumped from 392,000 in September 2017 to 2.9 million in March 2018. As of March 2018, 97 percent of credit card transactions in the United States were made with chip cards…. Read the full article.
Don’t Get Stung by Fraudulent Returns This Holiday Season
NRF estimates the retail industry loses $9.6 billion a year through fraudulent returns.
By Vidyuth Srinivasan
While the holiday season is supposed to be one filled with good will, it’s also a time rife with return fraud. According to the National Retail Federation (NRF), 95.2 percent of US retailers have been confronted with the attempted return of stolen merchandise, and that’s just one of the many scams that pose threats to retailers.
NRF estimates the retail industry loses $9.6 billion a year through fraudulent returns. Return fraud can take on many forms, from the aforementioned return of stolen goods or used items, to the return of items at a refund rate higher than what was paid, and even the purchase of items with counterfeit currency.
Now, with the rise of “super fake” counterfeits, many retailers have also been victims of a scam where the scammer purchases an authentic item but swaps it with a fake before returning it for a full refund…. Read the full article.
Fighting the Fakes: How to Build Your Brand Protection Strategy
Findings from recent studies serve as a warning to manufacturers to review their brand protection strategy.
By Garett Seivold
A study by the Government Accountability Office, released in January, observes a shift in sale of counterfeit goods from “underground” or secondary markets, such as flea markets or sidewalk vendors, “to primary markets, including e-commerce websites, corporate and government supply chains, and traditional retail stores.”
Additionally, the physical appearance of counterfeit goods may no longer serve as a red flag that a product is fake, as additional types of bogus products closely resemble genuine goods, according to the GAO report, Agencies Can Improve Efforts to Address Risks Posed by Changing Counterfeits Market…. Read the full article.
How All Merchants Can Book a Better Fraud Prevention Future
By Debbie Fletcher
Fighting digital commerce fraud is an unrelenting challenge for all merchants that do business online. To put it bluntly, it’s revenue protection. Chargebacks resulting from approved fraudulent orders cut into a firm’s bottom line in many ways: the replacement cost of the goods or services purchased, the actual dollar amount of the refunded transaction, and the chargeback fee levied by the merchant’s payment processor.
To minimize these chargeback costs, e-commerce merchants have adopted all sorts of fraud prevention measures. From investing in time-consuming manual reviews to consulting shared blacklists, e-commerce companies are constantly looking for the best way to reject every fraudulent order while approving all legitimate ones…. Read the full article.