Why merchants don't need to buy fraud insurance to cover everything
The discipline of fraud prevention has changed dramatically over the past five years and continues to evolve rapidly. Consequently, former truths about fraud prevention are increasingly becoming outdated myths. Legacy vendors propagate these myths to maintain relevance, but industry leaders understand the distinction and are moving forward.
In this article, the common myth we’ll tackle is that a merchant should buy fraud insurance to cover everything -- this is typically touted in the market as a 'chargeback guarantee.' On the surface, the simplicity is appealing; the vendor is claiming to solve merchants’ fraud problems by taking liability for chargebacks, returns abuse, Item Not Received abuse, and potentially more. But the statement is very much a myth for, at the very least, five important reasons:
The evolution of identity-based fraud: Why ATO attacks are at the top of the list
Digital identity is the new currency, and adversaries are chasing wealth. Research shows that 61 percent of data breaches are the result of compromised credentials. This is a common fraudster tactic, whereby using legitimate credentials allows them to avoid detection as they gather intelligence and stolen data that will allow them to undertake further fraudulent transactions.
Fundamental to the defense of systems is access control, but it has its limits. Attackers are continuously trying to circumnavigate these systems to access accounts, with login and payment flows frequently targeted. This is why many organizations have invested in anti-fraud technologies to detect and mitigate against such attacks.
Bespoke machine learning is a must to tackle FaaS underworld
When it comes to fraud, you can never be too careful. Especially when you hear about the brass neck of some criminal gangs that are increasingly adopting the persona of legitimate businesses to peddle stolen credit card details and other financial information.
Fraud-as-a-service (FaaS), as it’s known, has become an industry in itself, with criminals able to provide a one-stop-shop for scammers to rip-off customers and businesses. These organized fraud rings -- often manned by career professionals who know how to bypass rules-based systems -- are becoming increasingly sophisticated.
Pindrop delivers improved audio intelligence to combat voice fraud
Although we tend to focus on frauds as a result of online account takeovers, more traditional social engineering methods are still a major problem, as are newer threats like deepfakes.
Voice technology company Pindrop is using this week's RSA Conference to launch new features that boost the level of intelligence that can be gained from voice analysis.
Fighting the rising tide of rogue apps
We're battling a swell of rogue apps, and companies and consumers alike are struggling to keep their heads above water as these applications quickly become the tool of choice for fraudsters. According to our recent fraud data, rogue apps now make up 39 percent of global fraud attacks, growing at a rate of 50 percent per quarter.
Rogue apps attempt to impersonate a brand's application with the intent of committing financial fraud. They have the ability to wreak havoc on consumers and organizations alike, with financial institutions being a particular target.
Want a well-paid a career? Have you considered cybercrime?
OK, so there may not be a pension scheme and a company car, but rookie fraudsters are taking home approximately $18,700 (£15,000) a month with 'cybercriminal CEOs' making up to three times as much as their counterparts in legitimate businesses. According to a new report from Arkose Labs.
The return on investment for launching cyber attacks or committing online fraud is larger than ever before. Some of the highest earning fraudsters are known to be making around $7.5 million (£6 million) a year according to even the most conservative estimates. This is almost three times the amount that FTSE 100 chief executives were paid in 2020, when they earned an average $3.4m (£2.7m).
How to protect your business from loyalty fraud
Today, businesses are realizing that a top-notch customer experience is the key to staying one step ahead in a highly competitive market. Enterprises are investing in loyalty schemes to elevate the online shopping experience for their most valued customers.
Unfortunately, fraud rings have shifted towards account-based vulnerabilities and target loyalty schemes through sophisticated fraudulent techniques. Not only that, but individual customers and internal staff can also exploit loyalty schemes and commit fraud, according to Signifyd’s ecommerce data report. We explore how to protect your business from loyalty fraud to reduce both brand reputation and customer relationship damage.
Fraudsters better than customers at answering security questions
We're all used to those irritating questions you have to answer when you contact a company: the make of your first car, the town where you were born, the dog's maiden name, etc. But it seems that criminals may actually be better at answering them than we are.
Fraudsters are able to pass knowledge based authentication (KBA) questions 92 percent of the time, based on a national contact center case study, while genuine customers only pass KBA's 46 percent of the time.
Outsmarting the new generation of online fraudsters [Q&A]
Millions of dollars are lost to online scams each year and the fraudsters are getting ever more sophisticated in the targeting of their attacks.
Much of today's fraud is executed using information about the consumer's habits and personal details, usually captured in phishing attacks or data breaches. The fact that we’re conducting more of our transactions online as a result of the pandemic has created even more opportunity for fraudsters.
Financial fraud attempts up over 200 percent in two years
A new study into financial fraud from Feedzai finds that fraud attempts globally are up by 233 percent over the last two years.
Over the same period there has also been a whopping 794 percent increase in fraud on digital entertainment transactions. The effects of the pandemic are evident too with a 65 percent increase in online transactions and a 75 percent drop in US cash withdrawals.
Protecting voice communications from fraud and deep fakes [Q&A]
The UK's National Computer Security centre (NCSC) has recently issued new guidance on secure communications for voice and video calls and SMS in order to help protect consumers from scams.
UK telecoms regulator Ofcom has also announced a crackdown on scam phone calls using fake numbers as their volume has soared during the pandemic.
The countries where you're most likely to fall victim to cybercrime
Worried about becoming a victim of cybercrime? A new study from Surfshark reveals the places where your fears are most likely to be justifed, the countries where cybercrime density -- the number of attacks per million of population -- is highest.
The UK tops the list with 3,409 victims per million internet users, almost twice as many as the US (1,724 per million). The number of victims in the UK also grew by 130 percent compared to 2019, which is the second-highest year-on-year growth worldwide after South Africa which faced the sharpest rise of 277 percent.
Identity fraud gets more sophisticated, pointing to organized crime involvement
In the last year, 47 percent of all identity document fraud was classed as 'medium' sophisticated, a 57 percent increase over the previous 12 months.
A report from identity verification and authentication company Onfido says this points to organized groups attempting to create 'verified' accounts with fake documents before using them to embark on other types of fraud.
The changing face of fraud and how artificial intelligence is helping to counter it [Q&A]
Financial crime is on the increase and attackers must be stopped in their tracks. Financial service organizations new and old need to ensure they have the right technology in place to predict, detect and deter fraud, whilst ensuring minimal disruption to the customer journey.
We spoke to Martin Rehak, CEO of Resistant AI to find out how sophisticated artificial intelligence can detect known criminal practices and more importantly, predict the unknown emerging patterns of financial crime.
How technology can cut the rise of voice fraud
Coverage of fraud tends to focus on the online methods such as phishing, credential stuffing, opening fake accounts and so on.
But there's another side to the problem in the form of voice fraud via 'vishing' and the use of social engineering techniques, this is made simpler by the ease with which numbers can be spoofed so a call can appear to come from a legitimate number such as your bank.
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