December 1, 2016
While online sales figures from the Thanksgiving weekend should have put a smile on e-commerce retailers’ faces, the holiday season also puts fraud teams on alert. The trend of increasingly sophisticated fraud attacks has continued into the holidays, according to the NuData Security Holiday Cyber Risk Report. The Vancouver-based company that provides behavioral biometrics technology for online authentication pointed to several pieces of data suggesting account takeover and account creation fraud remain on the rise. The company analyzed 80 billion “behavioral events” across its customer base and found fraudulent activity at the login increased from 4 percent last November to 15 percent this year and that 60 percent of new account creations were fraudulent this year compared to 39 percent last year. NuData recorded 50 million fraudulent attempts during last year’s holiday season and it expects 82 million this year.
“It is clear that attackers are rapidly evolving their methods to more complex and evolved schemes,” said Robert Capps, vice president of business development for NuData Security. “Organizations must be ever vigilant as fraudsters leverage the mass of freely available data on the dark web for cybercrime. Expecting consumers to maintain strong, non-reused passwords isn’t realistic, meaning retailers need to shoulder an even larger responsibility to protect their brand and users. It’s more important than ever for online merchants to employ technology that can help them effectively differentiate good customers from bad.”
Mobile transactions are especially vulnerable this year as fraudsters turn their attention to a channel that is increasingly active—Black Friday and Cyber Monday were the first days in U.S. retailing history on which mobile online sales surpassed $1 billion in a 24-hour period. NuData said that while 11 percent of transactions originating from a mobile app or mobile website were considered high risk last year, 32 percent have been classified as such this year—triple the rate on a growing number of transactions.