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New report says bank fraud could drive consumers to PayPal, other non-bank online payments

March 5, 2009

Digital Transactions:Financial fraud threatens the growth of online payments and banking, and could potentially drive consumers away from banks and toward electronic-payment systems they perceive as being more secure, such as PayPal. Those are some of the conclusions in a new report from technology research and consulting firm Gartner Inc. about data breaches and financial crimes. The report, based on surveys of 5,000 adults, estimates about 7.5 percent of U.S. adults lost money to some form of financial fraud in 2008. Gartner's results add to a growing body of evidence that fraud costs bank customers more than just dollars. Victims of e-checking and/or savings-account transfer fraud in 2008 were nearly five times more likely to change banks because of security concerns, according to Gartner.

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