The number of companies reporting fraud attempts leaped from 42 percent in 2016 to 67 percent in 2017, according to an annual fraud study by fraud prevention vendor IDology. Just six percent saw fraud decline compared to the year before. The survey included businesses in the retail, financial, insurance and health care industries.
“Friendly fraud” by customers, often in the form of chargeback fraud, saw a huge spike, with double the number of businesses reporting it in 2017 than in 2016. Account takeover fraud, phishing and ACH or wire fraud were also rising in prevalence. Financial services firms reported higher levels of friendly fraud and synthetic identity fraud — in which fraudsters create an artificial identity out of multiple pieces of real and fabricated data — than businesses did overall.
The growing imperative to protect against fraud is also making financial firms more concerned about creating friction in the customer experience. Nearly half of financial companies surveyed said that reducing friction is a challenge to their business.