Spending Spikes, Fraud Follows
The economic outlook in the United States is on the upswing—more than half of all Americans have received at least one COVID-19 vaccination dose and they are traveling and spending. According to financial crime monitoring platform Feedzai, there has been a 21 percent increase in cross-state spending from January to March 2021. Additionally, the good economic news is global: transaction volume for all regions that Feedzai tracks is greater than pre-pandemic levels. However, fraud and financial crime are keeping up.
Banking fraud attacks—including Internet, telephone, and branch-based attacks—grew 159 percent in the first quarter of 2021 compared to the end of 2020. Telephone banking fraud in particular skyrocketed, with a 728 percent increase, and international transactions saw a 410 percent increase.
Feedzai's new Financial Crime Report - based on 12 billion exclusive transactions - finds consumers are on the move again. Unfortunately, with banking fraud attacks up by 159% fraudsters are clearly tagging along.— Feedzai (@feedzai) June 2, 2021
Download the report to learn more.https://t.co/PztcZYxhMH
But the majority of consumer banking is done online, and so is the majority of banking fraud attacks—93 percent, in fact. And increased reliance on digital services, from online shopping to mobile money, during the pandemic placed less digitally savvy consumers at higher risk for online and phone fraud, ZDNet reported.
According to Feedzai’s Financial Crime Report Q2 2021, the top five banking scams are:
- Account takeover. Fraudsters gain access to account credentials to hijack an account, often changing the password and address. Used in 42 percent of frauds.
- Account opening identity theft. Fraudsters open accounts using stolen identities; victims are often unaware until debt collectors come to call. Used in 23 percent of frauds.
- Impersonation scams. Fraudsters pretend to be an authority figure, like a government official, to try to gain access to an account. Used in 21 percent of frauds.
- Purchase scams. Buyers pay for items online that never arrive. Used in 15 percent of frauds.
- Phishing. Scammers use emails or other methods to trick account users into revealing personal information. Used in 7 percent of frauds.
Learn more about rising fraud trends in the May/June 2021 issue of Security Management.
In a survey of more than 5,000 respondents across 99 global territories in 2020, PricewaterhouseCoopers (PwC) found that 47 percent had suffered at least one form of fraud in the prior 24 months—averaging six per company. https://t.co/ldtRK7til3— Security Management (@SecMgmtMag) May 7, 2021