Fraud levels have more than doubled globally over the past five years, Jumio reports
New account fraud has gone up 18 percent in 2019 compared to 2018 global reports, adding up to a 106.8 percent increase over 2014 levels, says new data from Jumio.
Although a 19 percent decrease was noticed during the Black Friday/Cyber Monday weekend in 2019, fraud levels are still significantly high, especially in emerging markets, outlines Jumio’s Holiday Fraud Report.
Creating a fake new account is the first step in identity fraud. The double-digit increase in 2019 in new account fraud, account takeovers and identity theft are likely a consequence of the recent massive data breaches, including from Facebook, First American Financial and Verifications.io.
A passport scan can be easily purchased on the dark web for under $15, the report says, and it often comes in a package with multiple identification forms such as a selfie, utility bill, and/or a driver’s license which can be bought for anywhere between $14.71 to $61.27.
On average, Jumio processes some 300,000 verifications on a daily basis and over 200 million identities in over 200 countries. It analyzed global ID fraud patterns from millions of ID verification transactions which occurred between Thanksgiving and the Tuesday after Cyber Monday over the five-year timeframe, and it also looked at account fraud levels in different industries, countries and timeframes.
The highest rates of full-year fraud at 3.27 percent were noticed in the Asia-Pacific region, while the lowest numbers were found in the U.S. at 0.88 percent. Although holiday fraud rates were lower in the U.S. in 2019, the report shows new account fraud in the U.S. was 138 percent higher compared to 2014.
The most reported fraud cases in the region were related to card use in retail banking, consumer tech, telecom and airline sectors. A growing trend for online and mobile fraud was especially noticed in China, Hong Kong and Indonesia where digital financial firms are struggling to gain consumer trust, says the report.
In terms of top industries, increased fraud levels were found in the cryptocurrency and online gaming/gambling industries, with less than 0.6 percent reported in the sharing economy and travel and entertainment industries.
“As cybercriminals perfect and fine-tune their impersonation efforts, it’s getting more difficult for modern enterprises to distinguish between high-risk from low-risk users — and this is only going to accelerate thanks to large-scale data breaches, the evolution of the dark web and the looming threat of identity theft,” said Philipp Pointner, Jumio’s chief product officer. “All too often, companies rely on traditional methods of identity verification which are not well equipped to detect sophisticated methods of new account fraud.”
The global fraud detection market is expected to leap from $20 billion in 2018 to $80 billion by 2025, according to a recent report.