In 2009, banks and credit unions reported 41,548 suspicious activities related to card fraud, representing a 4.6% jump from 39,711 reports the previous year, according to the U.S. Department of Treasury’s Financial Crimes Enforcement Network, which maintains data on suspicious activity reports.
FinCEN attributes the continued rise in reported suspicious cases to general trends in credit card use and to the increase in incidents of identity theft coinciding with the growth in online purchases, a spokesperson tells PaymentsSource. FinCEN also cites “bustout schemes,” in which individuals max out their credit cards and use checks linked to the accounts to make fraudulent purchases.
The weak economy, particularly shortages in available cash, “leads to use of credit cards and increases the preponderance of possible fraud,” according to the spokesperson. FinCEN has seen more suspicious activity reports related to counterfeit credit card schemes, he notes, though he could not provide specific details.
Reports related to debit card fraud increased only slightly last year, by 3%, to 5,397 from 5,242 in 2008. FinCEN could not say why debit-related fraud reports grew at a lesser rate. However, the spokesperson suggests debit card accounts may have less funds available than credit card accounts, making them secondary targets.
