According to one global risk consultancy, an analysis of proprietary and other transactional data has led to several findings for 2023/2024
Based on a global survey of 1,845 decision-makers at financial institutions and retail and e-commerce merchants with responsibility in fraud management^, as well data from its own proprietary sources*, a risk analytics firm has published some findings about global fraud.
First, human beings continued to be a weak link in the trust chain data examined, with around 40% of money mules typically under the age of 25 helping cybercriminals launder between 2% and 5% of global GDP each year.
Second, less than 10% of mules identified by law enforcement had been arrested, and less than 1% had been charged in the incidents analyzed. Global fraud attacks had risen by 19% year-on-year in the data analyzed (data date ranges not specified).
Other findings
Third, “collaborative digital identity intelligence” and “integrated digital identity and email intelligence” were cited to have helped customers to improve fraud capture rates (26%) and customer recognition rates (94%). In one case a major global bank had used such intelligence to boost its detection capability by 1,700%. In another, a card issuer had improved its risk assessments by 2,300%.
Fourth, 60% of organizations in the data had indicated having technological fraud prevention solutions in place across all transaction channels, and 27% of organizations from the EMEA and APAC regions had indicated use consortia or data exchange initiatives as part of their fraud prevention activities.
Fifth, a majority (percentage undefined) of firms in the data had indicated integrating digital experience and fraud prevention efforts (72%) and minimizing customer friction during checkout (68%) as a “critical or high” priority.
Finally, the data was interpreted to conclude that “a shared collaborative network enables organizations to flag suspicious activity and confirmed fraud events with other members, to help make it harder for fraudsters to operate. This can include data about the device being used, IP addresses and other digital signals, as well as the email address provided. Analyzing the potential risk associated with these signals can significantly boost organizations’ effectiveness at capturing high-risk transactions.”
According to Stephen Topliss, Vice President, Fraud and Identity, LexisNexis Risk Solutions, the firm releasing its data findings: “Every attempt to make transactions easier for consumers is also making life easier for fraudsters… Robust intelligence can reveal tell-tale signs, such as the axiom that synthetic identities are seven times more likely to have no first-degree relatives and 20 times more likely to appear in multiple credit applications over a short time period. The worst-case scenario is that consumers cease engaging digitally because they don’t trust the process. Tackling this global issue requires a multi-layered approach, as there is no silver bullet anti-fraud solution.”
^from customers in the Asia Pacific, Europe Middle-East and Africa, the UK and Ireland, LATAM (including Mexico) and North America, including key pain points and opportunities related to fraud risk management.
*of over 92bn transactions and 1.3bn human-initiated attacks around the world, analyzed in near real-time across the customer journey, including new account creations, logins, payments and other non-core transactions such as password resets and transfers. Transactions were analyzed for legitimacy based on hundreds of attributes, including digital identity, device identification, geolocation, previous history and behavioral analytics
