Craig Botterill, the Crown attorney who handles such prosecutions for the province, said banks report only a fraction of debit and credit card crimes.
They are reluctant to jeopardize the hefty profits they earn from diverting business to electronic services from tellers, the prosecutor said.
"They're quite content to cover the losses in-house and not report most thefts..."
Canadian banks claim debit card scams cost them about $60 million last year, and credit card scams $163 million. But Mr. Botterill suspects the actual figures are much higher. He has heard of banks trying to keep quiet about single scams amounting to as much as $80,000.
The long-term effect of the failure to report these incidents is of course harmful for both the banks and the customers. Offenders are less likely to be caught by the bank investigation alone, and won't face criminal sanctions even if caught. Hence there's less cost to engaging in this type of fraud, and less deterrence against it. And in addition to the harm to additional victims in the future, there's also less than full recompense to the individual victim, who is effectively told that the breach of privacy is irrelevant.
If this story breaks strongly enough, then banks won't have much to gain by failing to report incidents. The public will be on notice as to the scope of the crimes, and any suspicions as to the scope of undisclosed crime will make for a strong incentive to show that all losses are being reported. Concerns over public fear would then turn in favour of reporting rather than against it.
So, pass the story along...and be all the more careful with your own information, because for now, your bank may not see its theft as worth reporting.
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