Ethoca in their report “Fraud Attacks Cross Industries” (Jan 2011) have established that in 86% of cases, fraudsters stopped using a credit card in less than 1 day (24 hours) either because the card was cancelled by the issuer or because the fraudster began using another card.

They also found that 10% of stolen cards were used at multiple merchants.

In only 29% of the cases did the fraudster stay within the same industry sector. In other words the fraudsters try to spread their fraud across as wide a field as possible. Probably to avoid the credit card issuers anti fraud procedures which can spot buying patterns – how many mobile phones does one person need?

The report established that the number one target for cross industry fraud was Mobile Phones followed by pre-paid Gift Cards. This means that in almost all case of organised fraud the fraudster will have a Mobile Phone and a Gift Card on their shopping list.

About the report

Ethoca’s data came from credit card issuers and online merchants. The 95 merchants studied in their program represent 61% of the top 500 Internet merchants as measured by revenue*.

Issuers had identified the fraud with their own risk management systems and then confirmed with the cardholder that the order was indeed fraudulent before providing the transaction details to Ethoca. As a result, Ethoca was able to study a total of 25,188 confirmed cases of fraudulent transactions from June 2010 through October 2010.

*Source: Internet Retailer Magazine for 2009 www.top500guide.com

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