Card fraud in Europe has been declining since 2007 despite the rising number and value of transactions, according to the second report on card fraud from the European Central Bank. The bank attributes the decline to better technology, but notes fraud quickly migrates to countries that are slow to improve security standards.
Total fraud in 2011 in the 32-country Single Euro Payments Area was 1.16 billion euros (US$1.52 billion). That was down 5.8 percent from 2010. Since 2007, the amount of fraud in SEPA has decreased 7.6 percent while the value of transactions increased 10.3 percent.
While countries in the SEPA zone will be pleased, the migrating fraud issue represents a serious threat. The bank reports that 78 percent of all fraud with counterfeited cards was carried out in non-SEPA countries, up from 61 percent in 2010. Counterfeit cards were not the only issue as 95 percent of ATM fraud occurred outside SEPA, up from 67 percent in 2010.
With many of the SEPA countries virtually 100 percent compliant with EMV technology, it is not all that surprising fraud has declined. While European countries are currently seeing fraud migrate to neighbors that are less EMV compliant, it won’t be long before the United States becomes the primary international host for fraud migration, or at least until the U.S. itself becomes EMV compliant a few years down the road.
