Online banking change leads to “significant increase” in fraud


Online fraud attacks increased by 250% during 2020 as the pandemic pushed people towards digital banking, according to a new report.

The Feedzai Financial Crime Report Q1 2021 found that there was a 200% increase in mobile banking services and a subsequent 250% increase in online banking fraud attempts between Q1 and Q4 of the year. last.

However, telephone and in-branch fraud rates have fallen to lower levels than before the pandemic.

At the start of the Covid-19 pandemic, “Card present” transactions declined by around 20% and remained at that level for the year, although fraud attacks on these types of transactions fell 48%, Feedzai said.

Account takeover (ATO) scams – when fraudsters obtain stolen user IDs, account information and passwords to transfer funds or purchase goods – saw the biggest increase in 2020, up 650%. Feedzai reported that a “ascend” in ATO fraud in the third and fourth quarters caused the spike.

“Card not present” transactions accounted for 70% of all fraud attacks in 2020, according to the Feedzai report.

Jaime Ferreira, Senior Director of Global Data Science at Feedzai, said: 2020 has been a year of rapid growth in financial crime.

“Fraudsters have tried to take advantage of the convergence between a fast-paced digital environment and a new wave of inexperienced consumers to perpetrate a multitude of attacks that have created a significant increase in fraud. “

In February 2021, the Federal Trade Commission reported to receive over 2.1 million consumer fraud reports in 2020, who lost $ 3.3 billion to fraud, up from $ 1.8 billion in 2019.

The Feedzai report found some regional differences, the Asia-Pacific region, where the pandemic began, experienced the biggest decline in economic activity at the start of the crisis.

However, he said the trading volume in that region has since recovered, which is not the case in Europe or North America, where benchmark trading volumes have remained declining.

As countries imposed nationwide lockdowns in the second quarter, demand for books and media streaming services increased. While demand has since fallen back to pre-pandemic trends, digital media fraud attacks in the United States and Europe have increased 178% since January 2020, Feedzai reported.

Feedzai’s full report is available here.

Source link

Previous Unbanked Pinoys Will Decrease 20% As More People Adopt Online Banking
Next Mizzou launches new online education program