Action Fraud reported £16 million has been lost to ecommerce fraud since lockdown? Statistics show that 16,352 people in the UK fell victim to online shopping fraud, with those aged 18-26 most at risk. The survey of 2,000 UK consumers looked at attitudes to, and experiences of fraud, finding:
- 76% believe shopping online puts them at a higher risk of fraud, with 50% regularly worrying about entering card information online – but 85% still made a purchase online in the last month
- 38% reported having been the victim of financial fraud, with 1-in-5 falling victim in the last 12 months
Ben Tuckwell, District Manager, UK & Ireland, RSA Security, comments: “[The] warning from Action Fraud is concerning but not altogether surprising. Unfortunately, fraudsters thrive in times of disruption. The recent shift to e-commerce has been critical for both consumers and the economy, but fraudsters have been quick to take advantage too. In fact, in the first three months of 2020, RSA recovered details of over five million unique compromised cards globally. Once credentials are stolen these card details are sold on the dark web to other fraudsters who can use them to buy goods.
“During the pandemic, fraudsters also appear to have had growing success targeting mobile applications for fraud – 26% of fraud transactions spotted by RSA in the first three months of the year came from this channel, double that of the previous three months. As more retailers have guided consumers towards mobile apps as a means to transact, it seems fraudsters have also looked to exploit this shift.
“While the consumer advice from Action Fraud is absolutely correct, banks, card issuers and retailers alike must also step up the war on fraudsters, both in times of crisis and in the future as shopping increasingly moves online. Pioneering businesses are already applying machine learning to better predict whether a payment is likely to be fraudulent.
“By looking at hundreds of different data points and assessing whether it is normal or suspect behaviour, banks and card issuers stand a better chance of stopping criminal activity in its tracks. As fraud detection gets increasingly smart, only the riskiest of transactions will require additional customer verification, meaning shoppers can purchase online with confidence and ease.”
Ian Johnson, Managing Director of Europe, Marqeta, comments: “92% of people who had been defrauded had been able to get fraudulent transactions removed from their account. This means the banks are often carrying the financial burden of fraud. Preventing fraudulent transactions in real-time – before the money leaves the customer account – needs to be a priority. The best way to do this is through having cards that have the capacity to ‘think’ and use contextual data to make judgements on fraud during the transaction process, rather than after the fact. The only way to do this is through a modern payment platform.”