ABA Report: Banks Stopped Nearly $17 Billion in Fraud Attempts in 2016

The nation’s banks stopped nearly $17 billion in fraudulent transactions in 2016 — a figure that represents a substantial increase since 2014 in attempted fraud, when the industry stopped $11 billion — according to ABA’s 2017 Deposit Account Fraud Survey Report released today. Fraud against bank deposit accounts cost the industry $2.2 billion in total losses, an increase from $1.9 billion in 2014. “Fraud prevention never stops,” said ABA EVP and Chief Economist James Chessen. “Banks are constantly monitoring for patterns and trends and quickly evolving their techniques to stay a step ahead of fraudsters.”

The survey — which sampled 138 banks of varying sizes — found that debit card fraud accounted for 58 percent of industry loss, with the majority of cases involving counterfeit cards, card-not-present transactions or lost or stolen cards. Check fraud was the next most common fraud type at 35 percent. Other channels, including online banking and electronic transfers like wires and ACH payments, accounted for 7 percent of industry losses.

Fraud attempts increased in all categories, especially in non-debit electronic channels. The volume of fraud attempted in other channels but stopped by banks more than doubled from 2014 to 2016. And while debit card fraud losses remained consistent with previous surveys, check fraud losses saw their first increase since 2008, surging by 28 percent to $789 million. “Fraud moves like water trying to find cracks in the system,” said Chessen. “We have long anticipated that fraudsters would change their tactics once chip card technology was implemented in the U.S. The survey shows attacks have shifted more to other payment platforms like checks and online transactions.”