Counterfeit credit card fraud registers a low level since 2013

The decrease in counterfeit fraud was reported in ACGs Card Fraud Control Benchmark Study, which tracks fraud trends among 30 US credit card issuers on a monthly and quarterly basis.

The counterfeit fraud reductions are correlated with EMV adoption, as card issuers make significant headway converting to the new standard: the embedded technology, which protects against counterfeit card use at store point of sale systems, now covers 66% of credit cards in circulation and more than 80% of cardholder spending.

Chip-on-chip transactions, a key measure of real-world EMV usage, increased to 30% in the first quarter of the year. Many issuers have accelerated EMV card issuance and put in place other anti-fraud protections, as criminals target less secure magnetic stripe cards.

While counterfeit fraud is declining, all other categories ACG tracks in the study, including identity theft, fraudulent applications, and lost/stolen, are increasing in frequency and levels of financial loss. Account takeover (ATO) has emerged as a particularly significant threat. A smaller category with historically low incident rates, the share of losses related to these attacks spiked 37% year-over- year.

Meanwhile, card-not-present (CNP) activity, which encompasses online and mobile fraud, increased 12%. CNP now represents the largest category of fraudulent activity, as fraudsters pivot away from physical attacks and take advantage of growth in ecommerce shopping.