5,000...of familiar fraud victims personally bear fraud losses Other fraud victims Familiar fraud...
Transcript of 5,000...of familiar fraud victims personally bear fraud losses Other fraud victims Familiar fraud...
2019 IDENTITY FRAUD STUDY:
Fraudsters Seek New Targets and Victims Bear the Brunt
Study overview“Given the agility and tenacity demonstrated by fraudsters in 2018, financial institutions should assume that every account type will
be under greater pressure going forward.” – Jim Johnson, EVP, FI Payments and Wealth, FIS
Post-EMV Reality “Digital is the battleground of fraud for the foreseeable future. Criminals know
it and members do, too. An institution’s accounts and onboarding need to be secured or its reputation and bottom line are at risk. The time is now to
implement the right tools and processes and to empower members.”– Al Pascual, SVP, Research and Head of Fraud & Security, Javelin Strategy & Research
Planning for the Future of Fraud and Risk “In the ever-evolving Fraud world, in which a fraudulent transaction can hide in plain sight – along with the pressing needs for real-time decisioning and new fraud schemes being deployed – we need to be able to combat and anticipate
them with AI and cognitive learning tools.”– Norm Marraccini, GM, Retail Digital Payments, ACH and Real Time Payments, FIS
RemediesFraud-fighting technologies in existence or on the near-term horizon can help
mitigate the burden on credit unions and their members:
FIS co-sponsored Javelin’s 2019 Identity Fraud Study which harnessed information from approximately
Decline in fraud across the industry – driven by reduced card fraud
Existing Card Fraud Incidence and Losses Decline
As a result, here is some insight to guide you in combating fraudulent activity for your credit union members.
5,000 CONSUMERS.
3.14%
2012 2013 2014 2015 2016 2017 2018
$11.99
$8.00
$9.85
$8.85 $9.21
$8.05
$6.53
4.60%4.42% 4.45% 5.07%
5.47%
4.40%
Fraud incidence (percentage of consumers) Fraud losses (Billions of U.S. Dollars)
As counterfeit fraud took a cliff dive, where
do attacks migrate?
EMV accomplished what it set out to do
New Account Fraud (NAF) stands as only major fraud type to increase YOY
(Top growth areas)
Online Accounts, e.g. Amazon
Mobile phone accounts
How effective have self-service fraud tools been for consumers? Focus on closing the
Awareness GapEducate/Deputize
consumers to be the 1st line of defense
Transition from physical to digital fraud
0% 20% 40% 60% 80% 100%
Unsure Feature is Available
Not Available
Have Feature-Do Not Use
Have Used-No Longer Do
Currently Use
ChannelLimits
MCC &Geolocation
Limits
TYPE
OF
CON
TRO
L
SURVEY RESPONDERS
CardOn/Off
SinglePurchase
Limit
9% 7% 14% 14% 57%
9% 9% 16% 14% 52%
18% 9% 24% 12% 37%
21% 8% 20% 10% 40%
Victim out-of-pocket expenses are skyrocketing
It is expensive to be a victim of fraud
Disproportionately weighted to younger consumer segments
Accounts with little or no liability
protection targeted
Align Channel Strategy with Appropriate Detection and Prevention Technology
Address authentication risk at all end-points for service and money movement
Expand fraud monitoring surface area to include cyber realm
Companies are nearly 3 months behind in detecting intrusions
Opening channel preferences will
shift as community demographics mature.
Rich stores of data make this sector a
major target.
Willingness to adopt and adapt to new innovations
will pivot in parallel.
Average time until detection (in days)
Evaluate cybersecurity of
third-party partners
Loyalty will increasingly be correlated to experience –
balancing security and ease will be more critical than ever.
Cyber monitoring must be more robust than the deep/dark web –
think social
of familiar fraud victims personally bear fraud lossesMore than70%
Other fraud victims
Familiar fraud victims
2015 2016 2017
57.6 80.6 92.2
Member card controls Improved authentication to prevent mobile phone account takeover
Better methods for verifying identities to mitigate the increasing fraud around digital account opening such as more document scanning safeguards and digital identity documents (eIDs)
More use of out-of-brand biometric pushes using a communications channel separate from the primary channel used to establish authentication
3-D Secure 2.0, which enables data sharing among merchants and credit unions for authentication
Federated identity schemes, which enable credit unions to use third party data to capture a better picture of an applicant’s identity
FIS can help equip your credit union with the most effective means
of fraud prevention, detection, and resolution.
TO FIND OUT MORE, CALL (877) 776-3706 OR EMAIL [email protected]
Source: Javelin Strategy & Research, 2019
Source: Javelin Strategy & Research, 2019
Familiar fraud doubled in 2018, from
of all fraud victims
7% 15% TO
More than
of NAF victims personally knew the perpetrator
50%
Source: Javelin Strategy & Research, 2019
Source: Javelin Strategy & Research, 2019
Source: FIS Business Risk Intelligence
74% 14%
32% 12%
Fraud victims that personally paid out
of pocket
Fraud victims that spent 10 hours or
more resolving fraud
All Fraud VictimsNAF Victims
Percentage of Familiar Fraud Victims
23%
16%
12%
16%
31%
51%
7%
4%2%
5%7%
15%
201820172016201520142013
Impact of Fraud on Members“With the evolving fraud types highlighted in the Javelin study, it is becoming
increasingly critical for institutions to maintain a holistic risk management playbook inclusive of all payment channels. Member empowerment should
also play a complementary role in the fight.”– Eric Kraus, VP, Fraud Management, FIS