The 2019 Identity Fraud Study, released by Javelin Strategy & Research, contains good news mixed in with the bad according to the report.
The good news is payment card fraud dropped from $8.1 billion in 2017 to $6.4 billion and the number of incidents fell from 5.47% to 4.40% mostly as a role result of EMV chip adoption. In 2018, 14.4 million US consumers were victims of fraud, compared to 16.7 million in 2017.
The bad news is 3.3 billion Americans were impacted by fraud and the cost of identity fraud doubled to $1.7
“While the decrease in card fraud rates is undoubtedly good news for victims, fraudsters have turned their attention to opening and taking over accounts,” said Javelin Strategy & Research Senior Vice President, Research Director and Head of Fraud & Security Al Pascual. “As financial institutions and other organizations modernize account opening processes, it’s paramount that they incorporate tools like document scanning, behavioral risk assessments and digital identity. This will streamline digital applications while challenging fraudsters.”
Other complex fraud is growing
Other sophisticated fraud types are growing. New account fraud losses grew from $3.0 billion to $3.4 billion as scammers looked beyond traditional card fraud.
Unconventional fraud also grew in mortgages, student loans, and car loans as fraudsters turned to other ways to steal from consumers. Loyalty and rewards programs and retirement accounts were also growing targets.
Account takeover decreased slightly year-over-year from 1.58
Fraudsters are getting better at overcoming account authentication challenges. Takeovers of mobile phone accounts nearly doubled, from 380,000 victims in 2017 to nearly 680,000 in 2018 as criminals looked for ways to intercept text messages used in two-step identity verification.
It’s clear that new fraud protection strategies and tools are needed for banks, lenders and other online financial service providers as fraudsters grow more sophisticated and their attacks default with the changing financial services ecosystem.
The annual Identity Fraud Study has been carried out for 16 years by Javelin Strategy & Research.