What is Payments Fraud?
With payments fraud, crooks use an existing payment method to get money they are not entitled to.
Check fraud, credit card fraud, debit card fraud, wire fraud — these are all considered payments frauds. And all these losses eventually come out of your pocket, either directly — like when you cash a check someone gives you and you have to repay the bank when it comes back unpaid — or indirectly — like when businesses have to raise their prices to make up for losses they’ve taken when crooks defraud them.
Crooks are finding it easier to defraud you and me. Why? There are several reasons:
- Technologies like smart phones and tablets are offering new ways to make payments, and we don’t always realize when they present security risks.
- Criminals are studying new technologies thoroughly and know exactly how to use them against us.
- The U.S. is an open and trusting society: we often believe what others tell us and do what others ask of us without questioning their intentions.
Taken alone, any one of these factors creates risk. Together, the combination produces complex exposures that make it easy for the crooks to defraud us, but difficult for us to realize we are exposed until after the crime is committed and we are left to suffer the consequences.