Fraud

Abstract

Fraud is an ongoing problem within the consumer credit industry. In the UK write-off due to credit card fraud is estimated to be $910 million’ per year (APACS 2008). In the US the value of fraudulent card transactions is estimated to be in excess of $3.5 billion per year (Experian 2007). These figures represent only around 0.1 percent of all card transactions, but can account for more than 10 percent of all bad debt experienced by a card issuer. This is despite many lenders having sophisticated fraud detection systems — without which the cost of fraud would be many times higher. Card fraud is perhaps the most widespread form of fraud associated with consumer credit, but other types of credit are also targeted by fraudsters to varying degrees.