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Those annoying new chips moved credit fraud online

Martin Meissner / AP

Nearly half of the fraud committed in 2016 was "card not present" (CNP) fraud; it was either committed online or in physical stores that don't have chip software activated yet. LifeLock reports overall fraud was up 18% last year, per the WSJ.

Wasn't chip technology supposed to make transactions more secure? Although it may take longer in store, chip technology brought losses from existing-card fraud down 30% from 2013 since chips are nearly impossible to clone. But 64% of storefront merchants still don't accept chips — that's because there have been massive delays in on-boarding retailers' software for the chip readers, since retailers and their hardware must be certified in a long queue, per CBS. Plus, after October 1 of 2015, the burden of paying for fraud costs transferred from financial institutions to the storefronts themselves.

Why it matters: Consumers are still bearing some hefty costs: identity theft and credit card theft cost 15.4 million consumers $16 billion in 2016 according to the study.

In the meantime, companies are investing in tokenization programs to protect information and combat cloning card fraud that comes from swiping cards (think Apple's Apple Wallet and MasterCard's Masterpass).

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