This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Cramer's Action Alerts PLUS - See his portfolio and get alerts BEFORE every trade. Learn more NOW!

How Buyers Are Fighting Credit Card Fraud

NEW YORK ( TheStreet) -- Across the globe, about one in four credit and debit cardholders have been victimized by card fraud, according to data from ACI Worldwide.

Card users in Mexico (44%) and the U.S. (42%) report the highest rates of card fraud -- what ACI phrases as having "direct experience" with fraud from credit and debit card use.

Roughly half of credit and debit card consumers shelved their plastic and started using cash immediately after being sidelined by card fraud -- at least for a while.

"The results of this survey show that card fraud continues to be one of the greatest threats and concerns for consumers, financial institutions and retailers," says Mike Braatz, director of payments fraud for ACI. "While there have been significant advances in fraud prevention technology, it is clear that more needs to be done to educate consumers about fraud and engage them as allies when it occurs. These results should serve as a call to action for financial institutions and retailers to remain constantly vigilant and earn the trust of customers by working with them to combat fraud."

Maybe half of all credit card users wouldn't be so quick to pull their cards after a fraud incident if they felt other partners in the credit card transaction had their backs in the fight against financial fraud artists.

The ACI study reports that a huge majority -- 82% -- of respondents say they are "very interested" in being notified of suspicious activity on their cards. They want to be told as soon as possible and prefer to hear via text, email or a call to their mobile phones.

By and large, banks and other financial institutions are doing that, but there is another partner in the credit card transaction chain that is falling short in protecting credit and debit card customers: retail merchants.

Data out Monday from Jumio, a Palo Alto, Calif., fraud services company, shows that U.S. card consumers "don't feel merchants are taking the necessary steps to protect both their customers and themselves."

One interesting figure from the study: 44% of Americans have opted not to sign the back of their credit cards. Instead, they're writing "see ID" to ensure the merchant representative actually asks them to provide their identity.

Unfortunately, 87% of cardholders tell Jumio that they are rarely or never asked for their ID when making a credit card purchase.

Evidently, card consumers want to hold retailers responsible for that omission.

"With millions of people facing serious issues of identity theft, consumers are now taking extra steps to create their own protection mechanisms so that other people cannot misuse their credit and bank cards," says Marc Barach, chief marketing and strategy officer at Jumio. "Regardless of the explicit consumer demand, too many merchants are not taking the necessary actions to confirm that a person conducting a transaction is actually who they say they are."

One option Americans seem to like is a digital version of their ID on their smartphones, which they could flash to counter staff at retailers to confirm their identity. But the Jumio report says merchants aren't exactly clamoring for that solution.

For now, retailers seem to be indifferent at the point of transaction to credit and debit card fraud. But consumers know it and may start holding them accountable by taking their business to other merchants who do show an interest in fraud prevention.

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Try it NOW
Only $9.95
Try it NOW
14-Days Free
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
SYM TRADE IT LAST %CHG
AAPL $128.46 0.00%
FB $78.97 0.00%
GOOG $558.40 0.00%
TSLA $203.34 0.00%
YHOO $44.28 0.00%

Markets

DOW 18,132.70 -81.72 -0.45%
S&P 500 2,104.50 -6.24 -0.30%
NASDAQ 4,963.5270 -24.3630 -0.49%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs