After several years of skyrocketing digital fraud (as tracked through LexisNexis Digital Identity Network solution), data shows the rate of attacks by humans rising by just 1% last year. That said, the number of attacks is still increasing, and organisations that become complacent are putting themselves at risk. Challenges are still multiplying around the world, and in the communications, mobile and media sector, attack rates were up 15% year over year (YOY). In other sectors, there was no significant increase in attack rate, suggesting that fraudsters are avoiding organisations with more sophisticated defences.
But the attack rate slowdown we’re seeing might be short-lived; fraudsters and scammers are likely retrenching against heightened security. In this report, we explore the tangled web of scams and mules in depth, and show how our data reveals telltale patterns of scam and mule activity. And we’ll demonstrate the value of collaboration as the only way to reliably reduce fraud in today’s complex environment.
Scams dominate global headlines, but organisations today struggle with a wide range of attacks, including the use of compromised or synthetic identities and payment credentials, bonus abuse and first-party fraud. In our detailed look at the relative incidence of these fraud classifications, first-party fraud was the number one reported category.
On the other side of the equation, enterprises that have invested in modern, sophisticated defences are enjoying success. AI tools are rapidly improving and scaling existing fraud detection schemes, for example, by enriching data sets with additional context to better identify unusual behavioural correlations that may signal fraud. Collaboration and data-sharing frameworks are important and growing practices as well, helping member organisations share intelligence on fraudulent entities and linking fraudsters in recognisable patterns of attack. As organisations overcome their hesitation to collaborate (often due to regulatory complexity and/or privacy laws), they’re drawing more value from their fraud detection solutions. Around the world, revisions of regulatory frameworks (like PSD3) are starting to provide improved clarity. Ongoing concern about fraudsters using generative AI has, so far, been limited to a relatively small number of well-reported cases that have required a fair amount of planning and sophistication (and human intervention). We do expect AI-powered fraud to grow and evolve; we’re already detecting more frequent usage in new account origination attempts to defeat less robust document authentication checks. Having a flexible, multi-layered fraud prevention strategy has never been more critical, so organisations can adjust their defences as needed to meet these ever-evolving threats.
Please download the eBook below for more.
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