If you make $75,000 or more a year and have a college degree, you are more likely to receive a credit and debit card fraud alert from your financial institution, according to a new survey report from CreditCards. com.
What’s more, despite the best efforts of financial institutions and new security measures, many types of card fraud are still on the rise because criminals have become more devious.
The Austin, Texas-based organization’s nationally representative sample of 1,000 U.S. adults surveyed found that 68% of those with annual household income of $75,000 or more have received a fraud alert compared with 40% of those making $30,000-$49,999 and 26% with income under $30,000.
The same is true for educational attainment: 65% of college graduates have gotten a fraud notification, compared with 49% who attended some college and 25% who have a high school education or less.
“Fraudsters seem to be swinging for the fences, focusing their efforts on high-value targets,” Matt Schulz, CreditCards.com’s senior industry analyst, said in a prepared statement. “And it’s not only more affluent and more educated households. Credit card limits typically exceed checking account balances. I think that’s why credit card fraud alerts outpace debit card alerts even though debit transactions outnumber credit transactions 2-to-1.”
Overall, credit and debit card fraud alerts are up 15% from two years ago, according to the CreditCards.com survey report. Thirty-one percent of U.S. adults have received a fraud alert regarding a credit card and 25% have received one concerning a debit card.
The increase in fraud alerts corresponds with an increase in card fraud, according to CreditCard.com.
However, the survey report also found that 37% who have been contacted about potentially fraudulent transactions say all of the transactions were legitimate purchases. Another 15% say most transactions were legitimate.
The prevalence of false alarms is a byproduct of the increasing game of cat-and-mouse between the bankers and the crooks. Even though financial institutions are developing new algorithms and data-based methods of identifying fraud, criminals are launching ever-more-crafty schemes, according to CreditCard.com.
For example, CreditCard.com reported that instead of selling hacked card numbers, thieves will also sell accompanying information such as zip codes that card networks use to authenticate transactions. In addition, fraudsters make bogus cards with fake chips to circumvent the security of EMV chips. When they use these cards at the point of sale, they tell retail clerks the chips aren’t working. Clerks then have them swipe the cards, which negate the new EMV security benefits, according to CreditCard.com
Despite the ubiquity of text messages and emails, most fraud alerts are still delivered via phone calls.
The survey report showed that 53% who have received a fraud alert say the most recent alert was delivered by a call, followed by 15% who had their card declined at the point of sale. Fourteen percent said they received a text message and 12% got an email.
The lack of texts is surprising because Visa- and MasterCard-branded cards are required to let cardholders opt-in to receive alerts via text messages (as of October 2016 and April 2017, respectively), CreditCard.com said in a prepared statement.
Moreover, while many 18-26 year-olds can’t be a minute without their smartphones, they are the least likely to receive fraud alerts via text. Just 6% who have received a notification say the most recent one came by text, according to the survey report.
Conducted by Princeton Survey Research Associates International, the CreditCard.com survey has a margin of error of 3.8% for the complete set of weighted data.
