Report: Merchants Weak at Communicating Anti-Fraud Measures to Consumers
May 19, 2011
Of all the companies involved in transmitting personal information online, consumers are the most confident that banks will protect them and least confident in online retailers, according to a report from anti-fraud technology provider ThreatMetrix and the Poneman Institute. Surprisingly, consumers have more confidence in social networks’ ability to protect personal information than online merchants, the report said. “It’s logical that consumers should have the most confidence in the banking industry’s ability to protect their information online, as banks have a responsibility to protect their customers’ funds,” said Reed Taussig, president and CEO of ThreatMetrix. “Social networks, however, surprisingly have a higher consumer confidence ranking than online businesses in regards to protecting personal information. That represents a problem for the e-commerce industry, which relies on secure online transactions as the foundation of their business model.” The report also found that 88 percent of consumers would not do business with banks or credit card and online payment processors if they had doubts about their security measures. Seventy-seven percent said the same for online businesses, and 56 percent for social networks. Taussig noted that each of those types of companies is threatened by security risks, but online retailers need to do a better job of communicating the measures they are taking to combat those threats.