Why your bank may not care if your credit card was hacked


Credit and debit card fraud cost the U.S. $6.15 billion last year, up 12.4% from the previous year, according to The Nilson Report industry newsletter. So you’d think the financial services industry, which shoulders most of the cost, would be proactive about quashing the use of stolen card data. But it may not make financial sense for your bank to replace your card—even if it knows the card has been compromised.

That’s because hacks go down in phases. One set of cyber attackers steals the information—say, by hacking into a major retailer like Target [fortune-stock symbol=”TGT”] or Home Depot [fortune-stock symbol=”HD”]. Those thieves sell that purloined plastic—or, more specifically, the data behind it—on online black markets and crime forums. There, a final set of fraudsters purchases the data to make unauthorized transactions. It’s an assembly line for digital iniquitousness.

If your payment card information hovers in limbo between those stages—up…

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