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Capturing Bust Out Losses

Question: 
Will the credit risk or fraud score I currently use capture bust out?
Answer: 

Most traditional credit risk scores on the market are designed to predict the likelihood of late payments (i.e. 90 days late or greater) rather than fraud. Additionally, most existing fraud scores were designed to predict third-party fraud. Although bust out can be a type of first party or third party fraud, is most commonly occurs as first-party fraud.

First published on 01/19/2009

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