Credit card fraud detection explained: see how banks flag unusual transactions, what triggers alerts and how to protect yourself from unauthorized charges.

New research from American Banker finds that card and check fraud has gotten more problematic for bankers over time.

Credit card fraud and identity theft both involve unauthorized use of your financial information, but identity theft can have longer-lasting effects.

Unfortunately, credit card fraud is incredibly common. There were more than 24,000 instances of credit card fraud reported to the Federal Trade Commission (FTC) in the third quarter of 2024 alone.

Like payment processor scams, credit card processing fraud takes many forms, from social engineering cons to “friendly” hustles from customers disputing legitimate charges.

The Nilson Report, which tracks the card industry, says payment-card fraud resulted in $33 billion in losses worldwide in 2022 and $13.6 billion in losses in the US.

This feature means that simply replacing a credit card may not be sufficient to prevent fraud. Put It In Writing Initiating a dispute process with the bank is a potential solution.

Since 2005, when the U.K. switched to the EMV standard, counterfeit fraud has decreased 63 percent, as noted in NerdWallet's Consumer Credit Card Report, but that was after peaking in 2008, three ...