THE RETAIL industry has witnessed a bigger rise in suspected digital fraud attempts coming from the UK than any other industry in the first half of 2023. This is one of the key findings of recent insights produced by TransUnion, the global information and insights company.
New data shows that the rate of suspected digital fraud – ie when a consumer or a fraudster is in the UK during a transaction – in the first half of 2023 is up 16% in the retail sector in comparison to the second half of 2022.
At the same time, gambling remains the industry with the largest volumes of digital fraud, showing an increase of 6% when compared to the second half of 2022.
“The rise in the rate of suspected digital fraud attempts in the retail sector is a worrying trend,” noted Chad Reimers, general manager of fraud and ID at TransUnion in the UK. “This is likely to be due to a number of long-term factors, including the popularity of online shopping and the growing sophistication of fraudsters.”
Reimers added: “Meanwhile, charge-back fraud – whereby customers dispute genuine and successfully delivered online purchases with their bank or credit card provider – remains a significant challenge, and particularly so in light of the growing cost of living.”
Targeted by fraudsters
TransUnion’s recent survey shows that two-fifths (ie 40%) of UK adults said they had been targeted by online, e-mail, phone call or text messaging fraud in the period between April and July 2023. Many of the fraud attempts reported by those consumers could potentially end up being a step towards retail fraud, whether that’s third party seller scams, stolen credit cards or account takeovers.
Consumers who said they were targeted by fraud were most likely to experience phishing (46%), vishing (36%) or smishing (34%) attempts. These are all types of fraudulent activity whereby criminals attempt to trick individuals into giving them their personal information via e-mail, phone calls or texts respectively.
In particular, vishing – or phishing via phone calls – has witnessed a rise from 25% in the TransUnion 2023 State of Omnichannel Fraud Report relative to other criminal tactics.
Need for proactive behaviours
Reimers informed Security Matters: “With 78% of consumers globally ranking the security of their personal data as ‘very important’ when choosing with whom to transact in the online environment, businesses need to be proactive in their approach towards fraud prevention.”
Fraud can be a real ‘moment of truth’ for the trust between a customer and business. It follows that the right fraud mitigation can become a key pillar of a customer proposition. This includes applying a layered approach underpinned by the latest technology and information designed to provide strong authentication measures and monitor for suspicious activity.
TransUnion assists businesses in protecting their customers and their bottom line by offering fraud analytics and cutting-edge device and behavioural insights, as well as the latest technology advancements in document verification. This helps to stop fraud in real-time, while limiting the friction in the user experience for genuine customers.
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