Fraudsters move to account takeover

A NuData report revealed that incidents of account takeover jumped 112% in the first quarter of 2015 compared to the same time period in 2014.

According to Patrick Reemts, VP of credit risk solutions at ID Analytics, account takeover is a type of identity theft where a fraudster uses parts of the victim’s identity such as an email address to gain access to financial accounts. Affected accounts can include credit cards, checking and savings accounts, brokerage accounts and store loyalty rewards accounts.

Reemts added that part of the reason for the increase in account takeover is the increasing adoption of EMV technology, which makes it more difficult for fraudsters to clone physical credit cards. As the United States catches up to the rest of the world in implementing EMV, criminals will turn to new techniques such as card-not-present theft and account takeover.

Don Bush, VP of marketing at online security company Kount, said when it comes to account takeover, fraudsters have time to act and instead of just using a stolen credit card or card number, fraudsters can use the victims history to change the addresses for email and/or snail mail statements.

For a bank account, a fraudster who has taken over an account might then clean out all the funds or pose as the true consumer and borrow money. The impact on the consumer is much more significant than when their credit card number is stolen.