Online Financial Attacks up 233%
The rate of fraudulent online financial attacks jumped 233% between 2019 and 2021, according to an analysis of 18 billion global banking transactions carried out by Portuguese technology company Feedzai, which specializes in fraud prevention.
According to the new Financial Crime Report “The RiskOps Age”, the number of frauds has grown at a faster rate than the rate of legitimate online transactions, reflecting a substantial increase in risk.
Low risk, high reward
“Living a digital lifestyle brings a world of convenience, but it also offers a low-risk, high-reward environment for fraudsters,” said Jaime Ferreira, vice president of global data science at Feedzai.
The company compared spending and consumption data before and after the covid-19 pandemic, between 2019 and 2021, and concluded that, while online transactions grew 65%, the rate of fraudulent attacks soared 233%.
One of the phenomena identified by Feedzai was “hide in plain sight”, in which criminals try to go unnoticed in environments where there is a large volume of low-value transactions each, which does not attract attention.
On digital entertainment platforms, which have experienced an exponential jump because of confinement, the rise in fraudulent attacks between 2019 and 2021 was 794%.
“It’s the perfect environment for fraudsters to hide in – in a massive number of low-value transactions,” explained Jaime Ferreira. The executive said that the greater the number of transactions, the greater the opportunity for fraudsters to test the use of stolen cards and other schemes without arousing suspicion.
“Consumers and banks need to pay attention to these small fraudulent transactions before they turn into large amounts,” he warned.
The trends accelerated by the pandemic situation, including the shift from in-person transactions to online transactions, have come together with the abundance of devices and accounts that each person has, which creates vast amounts of data.
Methods
Regarding methods, the most used fraud was account takeover, followed by the application of social engineering schemes and fraudulent purchases (where consumers pay for products or services that are never delivered to them).
Jaime Ferreira mentioned an interesting indicator that came from the analysis of data from the United Kingdom – where bank fraud is 50% more common via computer, phone or in person than via mobile application.
“We may be addicted to our mobile devices, but fraudsters are not so successful through this medium,” said the official. “The fact that attacks were 50% more common when UK consumers accessed the bank via computers, phones or in person is a clear indication that the mobile device is more secure when it comes to banking.”
Ferreira considered that consumers “should be encouraged to use secure mobile applications instead of their computers”.
Article credit: https://www.theportugalnews.com/news/2022-04-05/online-financial-attacks-up-233/66212