FICO Identifies Elevated CNP Fraud Trend in U.S.
Aug. 27, 2012
Predictive analytics company FICO, whose FICO score is the standard by which consumers’ credit risk is measured, last week released a report showing fraud on card-not-present transactions grew twice as fast as counterfeit card fraud. FICO looked at transactions from January 2010 to September 2011 and found that a trend already underway in Europe has come to the U.S. ahead of the migration to the EMV standard that caused the fraud shift overseas ( which FICO detailed in May ).
While the switch to Chip-and-PIN technology in Europe is seen as the catalyst for increased CNP fraud, here in the U.S. it’s simply a function of more online transactions, according to Doug Clare, vice president of Product Management at FICO.
“Continued improvements in fraud controls have succeeded in keeping the fraud genie in the bottle, but fraudsters continue to evolve their attempts to circumvent our efforts, adapting to consumer behavior and simply following the money,” Clare said. “More online shopping has created a shift towards more online fraud, which is proving to be a popular, relatively safe and anonymous means for fraudsters to exploit any weakness in fraud systems.”