Mobile banking is the safest way to bank for UK consumers, RiskOps platform for financial risk management Feedzai revealed in their Q2 2022 Financial Crime Report, based on the analysis of over 18 billion global banking transactions throughout 2021.
According to the report, banking represented 88% of all banking transactions in the U.K. during this period; however, fraud rates were over 50% lower using a mobile device compared with desktop, laptop, telephone, or in-person transactions combined. For mobile devices, fraudsters attempted 30% higher pound (£) amounts of fraud on Android devices, but fraud rates were 67% higher on iOS devices.
“While we might be addicted to our mobile devices, fraudsters aren’t as successful through this medium,” said Jaime Ferreira, VP of Global Data Science at Feedzai. “The fact that fraud attacks were over 50% more common when U.K. consumers banked via desktops and laptops, telephone, or in-person combined is a clear indication that mobile is safer when it comes to banking. Consumers should be encouraged to bank online via their secure mobile device apps, instead of their computers.”
Feedzai was also able to highlight the top 5 hotspots for fraud in the UK, identified as Poole, Leicester, West Berkshire, Buckinghamshire, and Derby, respectively, in 2021. Perhaps unsurprisingly, fraud rates were lowest in parts of Scotland and Wales: West Dunbartonshire, East Lothian, North Ayrshire, Wrexham, and Dumfries and Galloway experienced the lowest fraud rates, respectively.
The report identifies trends in consumer spending and fraud attacks and compares transactional intelligence from 2021 and the previous three years to provide insights from Lessopre-pandemic vs. the first and second years of the pandemic. One of the main conclusions is that while online transactions grew 65%, online fraud attack rates grew by 233%.
“The shift from in-person transactions to online transactions, along with the plethora of devices and accounts each person has, creates vast amounts of data points. From a fraudster’s point of view, this is the best-case scenario. It’s easier for them to hide in all that noise,” added Ferreira. “But it also creates opportunities for banks to create more effective and personal products and services. It’s for both of the reasons that we’ve called this report The RiskOps Age. Now is the time to connect teams and data to prevent fraud and provide elevated customer experiences.”
Top 5 Fraud Types of 2021
With fraud on the rise, the report also identified the top five fraud scams, with account takeover (ATO) and social engineering attacks ranking as fraudsters’ current favorite schemes. The top scam on the list has risen from fourth to first place since last year. ATO is a form of identity theft where fraudsters change account information, including passwords, and “take over” the account.
1. Account Takeover
2. Social Engineering Scams
3. Purchase Scams
4. Impersonation Scams
5. Smishing Scams
5 Ways Consumers Can Prevent Social Engineering Attacks
Remember, the click is a trick: Don’t open or click on suspicious links via email or text. Fraudsters can’t trick you if you don’t click on their links.
Update devices: Install and regularly update anti-malware software. When your computer or phone prompts you to install updates, do it.
Protect your privacy: Don’t provide personal information about yourself or your employer unless you are 100% sure the person you’re interacting with should have access to that information.
Use multi-factor authentication: Do not reveal personal or financial information in an email, and do not respond to email solicitations for this information. This includes clicking on links sent via email.
Don’t believe the hype: If an offer, prize, or opportunity is too good to be true, it isn’t true. Don’t fall for tempting out-of-this-world offers.