It's a new thing. The aim is so companies like Netflix don't lose subscribers when the subscriber loses their card and requests a new one.

The implementation is very shoddy - a mapping of old to new cards is distributed to any big provider who has charged the old card.

I didn't report it as stolen. But they did forward the charges. But yeah, I've just finished closing my credit card completely. It's unreasonable that I've been disputing the same charge from AWS for almost a year, and now they have decided to side with Amazon.