Online Payment Fraud Rising in U.S., Falling in UK?
Online payment fraud increased 32% to $1.14 billion in the U.S. from January 2010 to June 2010 versus the same period a year ago, which is in stark contrast to the UK where it decreased of 9%.
Retail Decisions, an international card fraud prevention group that screens 19 billion transactions for fraud annually, estimates that cardholder not present fraud will continue as shopping kicks into high gear for the holidays. At the current rate of increase the total figure will reach $2.83 billion, which is an area of major concern for retailers.
Thieves with stolen or cloned cards prefer to use them invisibly, where they don’t have to be physically handed over. So e-commerce channels are constantly under threat from scammers, especially in the U.S.
The huge rise in the U.S. is in sharp contrast to the improving situation in the UK, which will see a 9% fall in the value of attempted online fraud this year, which is largely due to industry initiatives such as chip and PIN and the increasing use of sophisticated fraud detection tools by retailers and banks.
With e-commerce fraud, instantaneous screening is the only way to effectively spot, reject and thwart the criminal activity and avoid losses for the innocent victims.The large increase in attempted payment fraud shows that cyber criminals continue to be very active, and their techniques are working.
ReD’s figures indicate that criminals are becoming more aggressive and targeting increasingly expensive items. In the first six months of 2010, the average transaction value for attempted fraud went up by an estimated 34% compared to the same period last year, from $111 to an estimated $149.