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As Credit Cards & Digital Payments Take Over, Fraud Continues to Rise

Stockhouse Editorial
1 Comment| April 12, 2022

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Americans average higher frequency of fraudulent charges than other countries, while total value of theft is highest in regions outside of the US:

This comes via a new study released by IBM (NYSE: IBM, Forum), titled the 2022 IBM Global Financial Fraud Impact Report, which found geographies and generations differ greatly in the frequency and impact of financial fraud, as well as their attitudes toward fraud detection and the institutions responsible for protecting them from bad actors.

The study also found that as global consumers have moved nearly exclusively to credit card and digital payments, US citizens have been victimized more regularly than all other countries surveyed in the report, costing American consumers an average of $265 (USD) per year in fraudulent financial charges made by unauthorized third parties.

Across all countries, respondents believe banks are the financial institution most responsible for preventing fraud, but in the US, nearly one-quarter of all respondents (22%) are not confident in their bank or credit card's ability to handle fraudulent charges or suspicious activity.


Management commentary:

Managing Partner, Global Banking & Financial Markets, IBM, Shanker Ramamurthy said that financial fraud and cyber threats are a growing menace to global financial institutions and their clients, increasing the need for companies to accelerate preventative measures to stay ahead of sophisticated criminal activity.

“As the global economy's evolution toward a cashless society continues at breakneck speed, banks and other financial institutions must continue to invest in modernizing their infrastructure and bolstering critical talent to meet the challenges they face from bad actors.”


From the report: Generational divide:

The report also found a wide range of generational differences, as Millennials (born between 1981 and 1996) are consistently the biggest victims of all forms of fraud, ranging from credit and debit card fraud to digital wallet, digital payment, banking and tax fraud.

GenXers (born between 1965 and 1980) reported the second highest number of fraudulent charges made by their credit cards or digital payment apps, while GenZers (born between 1997 and 2012) report the third highest instances of losing money as the result of a fraudulent charges.


In the news:

The leading global hybrid cloud and AI, and business services provider also made news this week when it announced IBM Impact, a new framework for the company's environmental, social, and governance (ESG) work that reflects how the company aspires to create a more sustainable, equitable, and ethical future. As detailed in the 2021 ESG report issued on Tuesday, IBM Impact comprises three pillars: Environmental Impact, Equitable Impact, and Ethical Impact. These values have been embedded in IBM's DNA as a company and have driven its work for its employees, stakeholders, and the world over the past century.



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