New study reveals a spike in digital and mobile fraud

LexisNexis Risk Solutions released the results of its latest Cybercrime Report, which revealed a significant shift to mobile fraud over the last four years, with mobile traffic representing 75 per cent of all traffic.

The Cybercrime Report analysed 35.5 billion transactions over the six-month period, up 44 per cent year over year (YoY). This stemmed from increased transaction volumes from existing customers and an increased customer base within the Digital Identity Network. Though global pandemic-related restrictions eased in the second half of 2021, the report found online transaction volumes continued to grow, specifically across financial services (52 per cent YoY) and communications, mobile and media (45 per cent YoY).

Increasing consumer confidence leads to enhanced demand for a customer-centric digital world. Companies are prioritising their digital customer experience strategies to retain and acquire new customers, which is advantageous for legitimate consumers but may lead to opportunities for fraudsters.

It is time to unite in the fight against cyber crime according to Stephen Topliss, vice-president of fraud and identity strategy for LexisNexis Risk Solutions.

“In a truly global digital economy, borders are no longer boundaries for trade or cyber criminals.

“It is more apparent than ever that fraud goes beyond single industries or countries,” Topliss said.

The analysis of transaction data from the LexisNexis Digital Identity Network in the second half of 2021 that was included in the LexisNexis Risk Solutions Cybercrime Report, July to December 2021 revealed that:

Global accelerated digitalisation and adoption of mobile applications fuelled by the pandemic continued across a multitude of different demographics and geographies. The first Cybercrime Report published in 2014 indicated that the percentage of mobile traffic in the Digital Identity Network was a mere 25 per cent. In the second half of 2021, the mobile transaction split reached 75 per cent for the first time. This shift was driven by a few factors: a predominance of mobile usage among younger generations; mobile app-only fintechs and the emerging market population moving straight to mobile and skipping desktop altogether; and the rapid decrease of service data and smart handset costs.
Scams on the rise in North America – Cryptocurrency excitement, together with pent-up consumer savings, relief checks and increased online shopping due to Omicron, fuelled US transaction growth while triggering a rise in scams. The Digital Identity Network tracked 15.3 billion transactions in the US and Canada in the second half of 2021, up 22 per cent YoY. There was also a significant rise in human-initiated attacks, with a growth of 50 per cent YoY based on 157 million attacks.
Automated bot attacks continue to rise; human-initiated attacks rose for the first time since 2019 – Automated bot attacks grew 32 per cent YoY globally, with LATAM showing the highest growth at 455 per cent. The US and Canada has seen a 7 per cent YoY decrease with 692 million attacks. Human-initiated attacks rose for the first time since 2019.
A single fraudster can leave a large footprint. The Digital Identity Network observed one fraudulent digital identity that attacked 35 different organisations and had 580 events associated with it. These included: 100 attempted account/creations/credit card applicants/loan applications; 45 attempted e-commerce purchases; 12 attempted password resets; and seven attempted changes to account details. The ability for organisations to benefit from global shared intelligence enables them to identify and stop more attempted fraud in real-time as fraudsters continue to benefit from breached identity data and automated bot credential testing.

Topliss further explained that for businesses to succeed in the digital world, they need to collaborate in the fight against fraud.

“This can be achieved by utilising the power of a global anonymised digital identity network and through the establishment of more focused digital consortiums among industry peers,” Topliss concluded.