As US card fraud rises, firms increase security spending

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.

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As US card fraud rises, firms increase security spending

Editorial

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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."

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Comments: (1)

A Finextra member 

The need colonic irrigation, not extra security...

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