Previous research has used the ratio of positives to negatives as the misclassification cost for fraud detection [14] and for medical data classification [15].
While retailers had an October 1, 2015 deadline to move to switch to EMV readers or face the liability costs for any fraud charges on EMC -enabled cards they swiped, probably less than half have made the switch, with estimates ranging from 22percenttoto about 40percentt.
When nobody pays a price for fraud, fraud proliferates.
Since European credit-card companies are responsible for paying most of the costs of fraud, they have a significant incentive to reduce it.
American credit-card companies, which operate under looser regulations, have been able to pass on much of the cost of fraud to retailers and even consumers, and thus have had little incentive to spend money to reduce the costs of fraud.Since retailers are responsible for a good chunk of the costs of fraud in America, they are now leading the way in making the switch to chip-and-PIN.
By October 2015, merchants who don't have the new terminals will be responsible for the cost of fraud if the consumer has a chip-enabled card.
That could translate into higher fees for all customers as banks pass on the cost of fraud losses, Ponemon argues.
"Even as the cost of fraud mitigation becomes higher, they're bringing the out-of-pocket expense for victims closer and closer to zero".
The bold Medicaid overhaul, part of a grand bargain with the state's most politically powerful health care players, has been promoted as a national model for curbing costs and reversing the incentives for fraud.
In an attempt to curb welfare costs, legislators stiffened criminal penalties for fraud, accelerated random home visits, established an anonymous tip line for people to report their acquaintances, and considered plans to fingerprint all welfare recipients.
