The latest findings from global business analyst TransUnion outlines just how adaptive fraudsters are to shifting security trends.
Based on client data collected by its flagship fraud analytics suite ‘TruValidate’, TransUnion has managed to assess “billions” of global transactions made on more than 40,000 websites and apps during Q1 2022.
The percentage of fraud attempts is calculated by a behaviour customers have either denied or reviewed due to suspicion-raising indicators. Interestingly, just as a house thief would ring a doorbell and then hide to see if there is someone home, the level of reported fraud attempts also helps criminals identify which sectors are the easiest to steal from.
Feedback from TruValidate has pointed out that in Q1 2022, some of these sectors were insurance, gambling, and logistics. Opposite to that, markets such as retail, telecommunications, and financial services have seen a decline in fraudulent behaviour, which corresponds to these industries’ increased investment in an anti-fraud infrastructure.
“Sophisticated fraudsters pressure test which industries have ramped up fraud prevention measures and as a result, turn to new industries if efforts are being thwarted,” said Shai Cohen, Senior Vice President of Global Fraud Solutions at TransUnion.
“That’s exactly what we have observed recently as fraudsters look for new opportunities or points of vulnerability. It is paramount that during this dip companies focus on optimising the customer experience for good customers.”
However, TransUnion says that the overall global rates of digital fraud in Q1 2022 are on the decline, with the company reporting 22.6% less than the same period last year.
Furthermore, a recent international TransUnion Consumer Pulse Study found that across 10,391 adults, a total of 36% report being targeted by fraudsters in the last three months compared to 38% in the previous quarter.
The US exhibits similar trends of declining fraud levels, with TransUnion stating that suspected fraud across all industries has decreased with 23.1% in Q1 2022 compared to the same period of last year.
Naturally, some business sectors remain more prone to falling victims of bad actors, with the US logistics industry exhibiting the biggest YoY Q1 2022 growth in fraud attempts. According to TransUnion, the most common type of logistics fraud is shipping fraud, with buyers either spoofing a shipping address or sellers getting paid without shipping anything at all.
Sean Donnelly, Senior VP and Go-To-Market Global Fraud Solutions at TransUnion commented: “As fraud rates stabilise during a period when fraudsters are searching for new vulnerabilities, many organisations have shifted their focus to identifying more of the good customers and transactions to increase revenue and customer lifetime value.
“By reducing false positives, false declines, and manual review rates, organisations can dramatically improve the customer experience through trusted connections while still keeping the fraudsters at bay.”
