AmEx Black Card members are more likely targets for fraud

finance.yahoo.com

NEW YORK (MarketWatch) — Holders of American Express Co.’s Centurion Card, also known as the Black Card, are nearly twice as likely to be targets of credit-card fraud than basic credit-card holders, according to Forter.

Forter, a fraud solution company for retailers, on Monday released results of a year-long study looking at hundreds of thousands of transactions around the world.

“Elite cards have much higher fraud rates [1.7%] than any other group,” spokesman Austin Rotter said in a statement. “They are a more attractive target for fraudsters since they are considered to have more money/better credit lines — they have higher market value.”

An American Express (AXP) spokeswoman said the credit-card company doesn’t often talk about specifics of its Black Card, but “combating fraud is an ongoing priority for American Express.”

“We recognize that this is an area that requires constant attention and improvement,” she said in a statement. “Fraud is an ever-evolving risk that adapts to new technologies and is something we must constantly work to mitigate.”

While elite cards have higher fraud rates, there are fewer of them, making the absolute number of cases lower.

Here are the fraud rates for other kinds of cards:

• Gold and platinum: 1%

• Loyalty clubs and international: 1%

• Basic: 0.8%

• Corporate: 0.7%

The study also found fraud is highest between 2 a.m. and 6 a.m., 10 times the rate between 2 p.m. and 6 p.m. Rotter said this is because fraud isn’t the day job, and fraudsters tend to wait until people are asleep to act.

While Rotter says fraudsters are typically indifferent to special events and increases in the number of shoppers, fraud rates surged by more than 200% on Christmas Eve and Christmas Day last year over a normal day, after most people had completed their shopping.

Trey Williams reports for MarketWatch from New York. You can follow him on Twitter @Trey3Williams.