Javelin Strategy & Research Finds Data Breach the Primary Source of Misused Payment Cards
San Francisco, CA, December 12, 2013: Over the past several years, criminals have proven immensely capable of compromising massive volumes of credit and debit card data by breaching the systems of organizations that store or transmit payment information. Among the most recognizable businesses to do so, merchants and processors have become high-profile targets. Javelin identified a connection between consumers being compromised in data breaches and later actually becoming a fraud victim. Today, Javelin Strategy & Research (@JavelinStrategy) released the Payment Card Data Security Report: Combatting Breaches, Perfecting EMV and Safeguarding Mobile Payments, which found that the number of notified card-breach victims who suffered fraud increased 340% from 2010 to 2012, resulting in $4.8B in fraud losses.
Despite industry guidelines to protect payment card data, 15.8 million consumers were notified that their card information was compromised in 2012. Criminals are motivated by the commoditized nature of payment card data, which has resulted from the popularity of massive underground forums where this type of data is quickly and easily sold. Card data fraud could continue to increase with the increased focus on mobile wallet and mobile payments.
"Criminals cannot use obfuscated card data as long as it is not returned to a clear-text format. Encryption and tokenization are industry-standard solutions that would render the data worthless in the commission of fraud, protecting businesses that intentionally or inadvertently handle clear-text data outside of PCI compliance," said Al Pascual, Senior Industry Analyst, Security, Risk & Fraud at Javelin Strategy & Research.
The report, Payment Card Data Security Report: Combatting Breaches, Perfecting EMV and Safeguarding Mobile Payments defines the connection between payment card data and card fraud, as well as how breach-related fraud impacts the relationship between retailers, FIs and consumers. It is based on two online surveys of more than 8,500 consumers.
Related Javelin Research
- 2013 Identity Fraud Report: Data Breaches Becoming a Treasure Trove for Fraudsters
- 2013 Data Breach Fraud Impact Report: Mitigating a Rapidly Emerging Driver of Fraud
- Mobile Wallet Game‐Changers: A Glimpse into 2014's Projected Winners and Losers
About Javelin Strategy & Research
Javelin Strategy & Research, a division of Greenwich Associates, provides strategic insights into customer transactions, increasing sustainable profits for financial institutions, government, payments companies, merchants and other technology providers. Javelin's independent insights result from a uniquely rigorous three-dimensional research process that assesses customers, providers, and the transactions ecosystem.