Purchases made without physically using a credit or debit card, including online purchases, accounted for about 47% of overall credit card fraud in the US between January 2011 and September 2012, according to a new report.
The data from FICO Falcon Fraud Manager Consortium revealed that the CNP fraud incident rate rose 25% during the time period, surpassing the fake fraud incident rate, which reported 14% growth.
However, the overall credit card fraud incident rate increased by 17% over two years, while the fraud dollar to non-fraud dollar ratio remained constant during the same period.
FICO global fraud solutions vice president T.J. Horan said that CNP transactions are very convenient for consumers, but CNP fraud can be especially complicated to combat.
"We have been evaluating massive volumes of credit and debit card data for 20 years, looking for changes in consumer buying patterns, and we have invested in innovations that quickly identify CNP fraud, without delaying legitimate purchases and unnecessarily inconveniencing consumers," Horan said.
During the period, the rate of card fraud attempts rose, while the average loss per compromised account dropped by 10%.
Conversely, the debit card fraud incident rate remained unaltered, with a 3% drop in the average fraud losses per account.
"While debit card fraud isn’t increasing in the US, we’re not seeing the same level of decreases as have been seen in the UK over the past few years," Horan added.
"But, as EMV standards get implemented in the U.S., we know that fraud will migrate as it has done in other regions of the world."
