Painting a Picture of the Impact of Fraud from Recent Data Breaches
The people have spoken. Well, at least some of the financial people who recently participated at BAI Payments Connect in Las Vegas have spoken. And they had a few things to say about payments fraud, fraud prevention, EMV and the recent data breaches. And the picture isn’t that pretty.
A survey conducted by ACI onsite of fifty financial industry professionals indicates that almost eighty percent of customer accounts and bank operations have been affected by recently publicized data breaches. I’m not surprised.
One of the breaches affected 40 million debit and credit cards, another breach affected 1.1 million accounts, while another affected almost 300,000 accounts. Combined that’s 41.4 million accounts. That’s a lot of people affected (and those are just some of the more high profile breaches).
Imagine if 6% of those accounts experience some type of fraud loss. Let’s assume each account lost $200 as a result of being compromised. That could result in a total of $49,680,000 in losses (2,484,000 accounts @ $200). The math in these things is never that simple or straightforward, but you get the picture.
Now imagine the fraud shops and customer service centers that need to not only manage those accounts which have been compromised, but also respond to the millions of customers who want some assurance that their accounts and data are safe. Wait times in calls centers get longer. Customers get frustrated. Customers take to social media with their rants. Fraud prevention teams need to immediately employ tactics to prevent additional impact and loss. Again, you get the picture.
While the number of respondents participating in the survey may not be significantly large, the collective responses extracted from the data convey a point of reference to some of the concerns held by the fraud and payments industry. Customer accounts compromised through data breaches have far reaching effects.
Get the picture?
Up next from the BAI Fraud Survey:
Defenses required in the fight against fraud and a new perspective on EMV
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