Falling victim to fraud is an event most consumers dread, and for some fraud victims, their worst fears are realized. Just look to the headlines of last week—with the indictment of 11 people for the organized hacking of nine major U.S. retailers—and think about how 40 million cardholders reacted to the news.

Among victims of fraud surveyed by Deloitte LLP, 44 percent said they found the experience to be somewhat or very disruptive to their lives. That's a significant number, and when an issuer does not effectively manage the impact of a fraud incident, customers are likely to change their behavior in ways that directly affect profitability. For example, 17 percent of fraud victims said their level of trust in their issuer had decreased.

Read tips on how to prevent identity theft and fraud from reformed con man Frank Abagnale. As he says, "If you haven't been a victim of identity theft or fraud, it is because thieves haven't gotten to you yet."

This loss of trust can lead to lost revenues. Roughly half the fraud victims reported having a checking account with the financial institution that issued the cards they used most often and 41 percent reported having a savings account. These products are at risk when a fraud incident is not well managed. Twenty-nine percent of fraud victims said the incident had led them to reduce their business with the financial institution—including using their card less often, canceling the account, or even canceling all products they had with the institution. The result of mismanaged fraud incidents can be lower net interest margin, revenue lost on other products, and higher customer acquisition costs to replace the lost business.

The problems often don't end there. Dissatisfied consumers are inclined to tell friends and relatives about their unhappy experience—becoming, in effect, the opposite of the positive customer advocates that financial institutions want to create. In fact, roughly two-thirds of the fraud victims surveyed, and half of other consumers, said they knew of friends, relatives, and colleagues who had recently experienced fraud. Simply put, a poorly resolved fraud event creates ripples that travel far beyond the original consumer.

If, on the other hand, a payments provider handles a fraud incident effectively, it can result in a stronger customer relationship. Actions such as alerting customers to potential fraud, quickly stopping use of their card and helping them easily resolve unauthorized transactions tend to resonate with consumers.