News: General News

Check Scams Top List of Fraud Threats

Sunday, January 26, 2020  
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Check fraud accounted for 47%, or $1.3 billion, of deposit account fraud losses, closely followed by debit card fraud losses at 44%, or $1.2 billion. The remaining 9%, or $265 million, of losses were attributed to electronic banking transactions, including bill pay, P2P transfers, wire and ACH transactions, according to the latest Deposit Account Fraud Survey report from the American Bankers Association.

“Sometimes, what’s old is new again as we’ve seen criminals gravitate back toward check fraud,” said Paul Benda, senior vice president, risk and cybersecurity policy at ABA. “Fortunately, banks are well-equipped to catch this type of fraud and do it successfully day in and day out.”

Total attempted check fraud increased to $15.1 billion and accounted for 60% of attempted fraud against deposit accounts. Banks’ prevention measures stopped $13.8 billion or 91% of attempted check fraud. The leading check fraud categories were counterfeit checks, forged signatures, and return deposited items.

Point-of-sale debit card fraud in the U.S. has moved from counterfeit cards (25% of loss, down from 47% of loss in 2016) to card-not-present transactions (42% of loss, up from 30% loss in 2016).

Looking ahead, the top five fraud threats identified by the respondents are debit card, online banking, wire originations, check deposits and P2P transactions. Survey respondents rated customer victimization scams (e.g., fake check scams, Internet job scams, lottery scams), phishing emails and business email compromise schemes, social engineering (including recruitment of money mules via social media), elder financial abuse, and ATM/gas pump skimming as the leading risks to the banking industry and its customers in the next 12 months.