Credit Card Fraud Continues to Intensify
May 1, 2015
There were several high profile cases of identity theft just last month. In the beginning of April, federal agents busted a ring of 42 identity thieves in Miami. The thieves had collected $3.2 million in tax refunds and $656,000 in state unemployment benefits. Even federal agents aren’t safe from identity theft. An FBI employee in Virginia was informed by his bank that his identity was stolen by someone in London, who was buying train tickets in his name. Other times, federal employees play a part in identity theft. Earlier in April, a former DEA manager was convicted of wire fraud. The DEA manager submitted 32 fake credit card applications using her colleagues’ identities, and used the payment cards to withdraw $114,000 from ATMs in the DC area.
The Federal Trade Commission estimates that an average of 9 million Americans have their identities stolen annually. One quarter of identity fraud cases are due to credit card fraud, and typically these criminals use stolen identities to make purchases.
According to the 2015 Identity Fraud study by Javelin Strategy & Research, $16 billion was stolen by identity thieves from 12.7 million American consumers last year. The most targeted demographic for identity theft through credit card fraud is students. Students are more likely to perceive significant effects of fraud, like being denied credit, and 15% said they felt severe impacts of identity theft. In addition, the report found that identity thieves would open up new credit cards in their victims’ names, and the victims wouldn’t notice. Victims of new account fraud are three times more likely to take over a year to find that their identities were misused.
As credit card fraud becomes more prevalent, credit card companies, retailers, and financial institutions need to make sure that there are measures in place to protect customer identities. Acuant’s credential management solutions are designed to reduce fraud by capturing accurate consumer identity information. Businesses can opt to verify that captured information, thus prevent criminals from fraudulently signing up for a credit card in another person’s name. In this age of prevalent identity fraud,these tools enable businesses to help minimize the risk of identity fraud for their consumers.