As US card fraud rises, firms increase security spending
04 April 2014 | 5344 views | 1
US credit card fraud increased last year despite efforts by firms to beef up their security, according to an Association for Financial Professionals (AFP) survey.
The poll of 5644 AFP members - sponsored by JP Morgan - reveals that 60% were exposed to actual or attempted payments fraud last year, down from 68% in 2011. However, 70% did not take a financial hit from their brush with crooks.
Cheque fraud continues to be the most prevalent type of payment fraud, accounting or 82% of incidents last year. Card fraud is a distant second at 43% but this is a big jump from 29% in 2012.
With card fraud in the news following the recent high-profile Target data breach, 63% of respondents say that they have either adopted additional security measures or are planning to do so in the near future.
Firms are taking a range of approaches, including secure signature stamps, electronic signatures, payment data stored with third-party vendors and increased layers of security.
Yet just 22% think that this investment will have a significant impact on fraud prevention, with half thinking that it will do some good.
Jim Kaitz, CEO, AFP, says: "Criminals will try to stay a step ahead. But with potential liability increasing for merchants, companies are taking a hard look at where their own vulnerabilities lie. This is especially important for big companies with complex systems, which are frequent targets for fraud."