Medusa

Latest Report Shows Digital Fraud Continues To Rise

<p style&equals;"text-align&colon; justify&semi;">Fraudsters can certainly be accused of plenty of things&comma; but if the latest research into global fraud is anything to go by&comma; a lack of persistence&comma; or inactivity&comma; is certainly not one&period; The annual Global Fraud Attack Index is hot off the press&comma; and has revealed a 137 percent rise in fraud attacks across the board&period; The headline finding is that global fraud now affects &dollar;7 out of every &dollar;100 of online global retail spend&period;<&sol;p>&NewLine;<h2 style&equals;"text-align&colon; justify&semi;"><strong>The Report’s Findings<&sol;strong><&sol;h2>&NewLine;<p style&equals;"text-align&colon; justify&semi;">The downloadable 29-page report presents an extensive range of data that illustrates the true extent of the problem of digital fraud today&period; The report’s most prescient findings are summarised below&colon;<&sol;p>&NewLine;<ul style&equals;"text-align&colon; justify&semi;">&NewLine;<li><strong>Online fraud has risen dramatically<&sol;strong><&sol;li>&NewLine;<&sol;ul>&NewLine;<p style&equals;"text-align&colon; justify&semi;">There has been a surge in the number of online frauds committed in 2015 and this trend has continued into the first quarter of 2016&period; The fraud attack rate has increased from quarter to quarter&comma; rising by 11 percent from Q3 2015 to Q4 2015&comma; and 26 percent from Q4 2015 to Q1 2016&period; In Q1 2016&comma; there were 34 fraud attacks for every 1&comma;000 transactions&period;<&sol;p>&NewLine;<ul style&equals;"text-align&colon; justify&semi;">&NewLine;<li><strong>The pattern of fraud has changed<&sol;strong><&sol;li>&NewLine;<&sol;ul>&NewLine;<p style&equals;"text-align&colon; justify&semi;">There has also been a deviation in the pattern of frauds&period; Typically&comma; fraud rates drop in the fourth quarter of the year as Christmas approaches and the number of online transaction increases &lpar;the fraudsters cannot keep up with the surge in transactions&rpar;&period; The rate of fraud attacks then rises again in the first quarter as the number of transactions declines&period; However&comma; this year the fraud rate remained constant throughout the year&period;<&sol;p>&NewLine;<ul style&equals;"text-align&colon; justify&semi;">&NewLine;<li><strong>The cost of fraud has risen<&sol;strong><&sol;li>&NewLine;<&sol;ul>&NewLine;<p style&equals;"text-align&colon; justify&semi;">The potential cost of fraud also continues to rise&period; At the beginning of 2015&comma; less than &dollar;2 out of every &dollar;100 spend online was subject to a fraud attack&period; By Q1 2016&comma; this had risen to &dollar;7&period;3 out of every &dollar;100&period; This increase could put a serious dent in retailers’ profits&period;<&sol;p>&NewLine;<ul style&equals;"text-align&colon; justify&semi;">&NewLine;<li><strong>A change in the method of attack <&sol;strong><&sol;li>&NewLine;<&sol;ul>&NewLine;<p style&equals;"text-align&colon; justify&semi;">The types of attack the fraudsters are commonly using has also seen a shift&period; Last year it was botnets &lpar;a network of private computers infected with malicious software&rpar; that accounted for 34 percent of all attacks&period; This was followed by account takeovers at 17 percent and location manipulation at 10 percent&period; In Q1 2016&comma; botnets accounted for 79 percent of all attacks&comma; with account takeovers dropping to just 4 percent&period;<&sol;p>&NewLine;<h2 style&equals;"text-align&colon; justify&semi;"><strong>The Cost to Customers<&sol;strong><&sol;h2>&NewLine;<p style&equals;"text-align&colon; justify&semi;">As well as the growing regularity of fraud attacks&comma; the tactics used by the fraudsters are also becomingly increasingly intelligent and sophisticated&period; Attacks on digital goods are now the most common type of fraud&comma; and customers are continuing to be caught out despite the additional security measures being put in place&period;<&sol;p>&NewLine;<p style&equals;"text-align&colon; justify&semi;">As security becomes more stringent&comma; customers can become frustrated by the measures they have to go through simply to complete a transaction online&period; For many customers&comma; the inconvenience caused by security measures can cause them to change their brand loyalties and even cancel their accounts&comma; and this clearly has an impact on a merchant’s bottom line&period;<&sol;p>&NewLine;<h2 style&equals;"text-align&colon; justify&semi;"><strong>The growing Problem of Phishing Scams<&sol;strong><&sol;h2>&NewLine;<p style&equals;"text-align&colon; justify&semi;">Another area online consumers have to be increasingly aware of are phishing scams&period; In this case&comma; the fraudsters send spoof messages to members of the public to direct the user to enter their details at a fake website&period;<&sol;p>&NewLine;<p style&equals;"text-align&colon; justify&semi;">The South African financial services provider Wonga was recently the victim of such a scam when fraudsters sent members of the public messages purporting to be from the lender&period; The recipients of the message were urged to pay an upfront fee in return for a loan of R150&comma;000 &lpar;an amount Wonga does not lend&rpar; at 3 percent APR&period; Of course&comma; in this case&comma; instead of providing the loan&comma; the scammers simply took the upfront payment&comma; and the users’ bank details&comma; and ran&period;<&sol;p>&NewLine;<h2 style&equals;"text-align&colon; justify&semi;"><strong>How can Customers Protect themselves&quest;<&sol;strong><&sol;h2>&NewLine;<p style&equals;"text-align&colon; justify&semi;">There are a number of measures customers can take to protect themselves from the growing number of digital scams that are defrauding innocent members of the public&period; This includes&colon;<&sol;p>&NewLine;<ul style&equals;"text-align&colon; justify&semi;">&NewLine;<li>Only ever making payments through websites with a secure payment gateway&semi;<&sol;li>&NewLine;<li>Never replying to an email with confidential or sensitive information&period; Legitimate organisations will never ask for this type of information over email&semi;<&sol;li>&NewLine;<li>Never clicking links in an email to connect to a website&semi;<&sol;li>&NewLine;<li>Never submitting confidential information via forms embedded in emails&semi;<&sol;li>&NewLine;<li>Never being pressured into making a purchase or sending sensitive information by anyone&comma; no matter who they may claim to be&period;<&sol;li>&NewLine;<&sol;ul>&NewLine;

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