Apr 1, 2025

UK sees formation of data sharing fraud squad as easy access to tech democratizes fraud Apr 1, 2025, 1:34 pm EDT A common enemy can bring together unlikely allies, and right now the common enemy of banks, tech and telecoms firms is fraud. According to the UK Office for National Statistics, fraud accounts for around 41 per cent of all crimes in England and Wales, costing an estimated £6.8 billion (US$7.3 billion) each year. In the U.S., data breaches are having more severe consequences, and payment fraud is growing like a bad mold across the digital financial landscape. Injection attacks , deepfakes and other products of generative AI are getting easier to execute and distribute. The problem has become severe enough to force responses from both governments and the private sector. Supergroup of UK banks, tech and telecom firms bands together to fight fraud The Financial Times reports on a plan by some of the UK’s biggest companies to begin sharing live fraud data, in a united front against a fierce and fast-advancing foe. A joint statement from the coalition says that after a period of testing, it is transitioning to real-time exchange of fraud indicator data, such as suspicious URLs or unusual transaction activity. Signatories include Barclays, Lloyds, Santander, Nationwide, HSBC, NatWest and Monzo on the financial side, as well as tech giants Amazon , Google, Match Group and Meta, and telecoms groups BT and Three. Ruth Evans, chair of Stop Scams UK , a cross-sector umbrella group leading the initiative, says that “by making this pledge, our members are redoubling their efforts to create a safer environment for all businesses and consumers online.” The previous testing period in 2023 saw relatively little data exchanged compared to what is now possible. Stop Scams UK CEO Mark Tierney says the scheme has since changed “exponentially” with the implementation of automated systems that can process data much faster. Per the Times report, many are calling for a stronger government response to the fraud problem. Fraud minister Lord Hanson is developing a new fraud strategy that enables safe, speedy and effective exchange of data. TransUnion, Sift, BioCatch highlight scale of fraud in U.S. in new publications New reports from TransUnion and Sift lay out the scale of fraud in the U.S. TransUnion ’s H1 2025 Update to the State of Omnichannel Fraud Report shows that the severity of primary data breaches increased by 34 percent from a year earlier, with the primary U.S. Breach Risk Score (BRS) rising from 4.1 to 5.6 out of 10, and third party rising from 4.2 to 5.2. In a release, Steve Yin, global head of fraud at TransUnion, says that “breach severity is a leading indicator of future fraud. This year’s growth in severity means organizations must be even more diligent moving forward and work even harder to defend against the oncoming identity fraud attacks such as those in account creations, social engineering scams, and account takeovers.” The report identifies communities and gaming as industries seeing the highest rates of digital fraud globally. Communities, which encompasses online dating and forums, showed the highest rate of suspected digital fraud attempts, with nearly 12 percent of all attempted community transactions suspected to be fraudulent. Video gaming does not fare much better, at 11 percent, while online gambling and retail both come in at 8 percent. Everybody fraud now: easy access to data, tech makes fraud an easy side hustle Meanwhile, Sift ’s newly published Q1 2025 Digital Trust Index reveals what a release calls an “alarming trend in the democratization of payment fraud,” noting that “34 percent of consumers have seen offers to participate in payment fraud online – an 89 percent increase over 2024.” Once thought to be the purview of shady hacker types in hoodies, fraud is now not just a risk for individuals, but also a lure. “The democratization of fraud through the widespread availability of stolen payment information and validation tools – easily found and purchased online – is luring ordinary consumers into cybercrime ,” says Kevin Lee, SVP of customer experience, trust and safety at Sift. The trend is particularly concerning in that it appears to appeal to young people; per the report, “among those who personally participated in or know someone who has participated in payment fraud (23 percent of all surveyed consumers), 32 percent of Gen Z and 43 percent of Millennials admitted to personally participating in payment fraud schemes.” Industries that showed the highest attack rates include ticketing and reservations at 7.4 percent, social media at 5.2 percent, and transportation at 4.8 percent. A summary of the report on Sift’s website says “high-demand events, such as the Taylor Swift concerts, have forced ticketing platforms to process transactions more quickly to meet customer expectations, opening the door to more fraudulent activities. As a result, the ticketing industry saw an 85 percent rise in attempted payment fraud year-over-year.” Data from BioCatch shows young people just as vulnerable as the elderly BioCatch is not letting Europe off the fraud hook; its new report notes that France lost an estimated €4.5 (~US$4.8) billion to fraud in 2023. In a release, BioCatch Director of Global Fraud Intelligence Tom Peacock says “57 percent of French citizens say they’ve received scam messages and 13 percent report having fallen victim to a scam.” But the figure swells to 72 percent – with 16 percent falling victim – among those 35 and younger. Peacock notes that, “while many might find it tempting to stereotype the elderly as the most vulnerable targets for scammers, in France, data shows young people both receive more scam attempts and fall victim to those attempts more often than those from older generations.” Investment scams are also on the rise, having tripled over the last three years. Per the report, more than 3 percent of all French citizens – an estimated 22.7 million people – admitted to losing money to this type of scam. The long-term consequences can be damaging psychologically; BioCatch data shows that “six months after falling victim to a scam, some victims still log into their online banking accounts twice as frequently as they did before they lost any money, suggesting feelings of anxiety, mistrust and fear.” Feedzai takes a look at account takeover fraud A new report from Feedzai looks at account takeover fraud (ATO), which cost U.S. adults approximately $23 billion in 2023. ATO crime has risen steadily in recent years; per a release, data shows that bank accounts saw the most significant surge in ATO activity from 2021 to 2023, with a 10 percent rise. The report says global fraud losses are expected to reach $5 trillion, but several avenues for preventing ATO attempts are available, including behavioral biometrics, malware detection and device fingerprinting. NEC says face biometrics can stop fraud – if systems are good NEC likewise has things to say about fraud and how it impacts people. “People don’t think about security until it fails,” says a new post from the facial biometrics provider. “But what they remember is how the experience made them feel. If onboarding feels seamless, they stay. If transactions feel safe and smooth, they come back. If something feels off – or clunky – they look elsewhere. Experience builds trust – and trust is everything.” In NEC’s view, biometric technology can make all the difference, provided it’s done right. “Financial institutions globally are increasingly adopting facial biometrics, liveness detection, and AI-powered fraud prevention solutions to deliver secure digital ID experiences to customers,” it says, citing numbers from Research and Markets showing that the global biometrics market in financial services was valued at $5.9 billion in 2023 and is projected to reach $15.2 billion by 2030. As customers embrace biometrics, care must be taken to choose the right tools. High-quality, effective biometric solutions can, of course, significantly reduce fraud and enhance user experiences. But it’s not enough for firms to come in waving flags that say “ biometric authentication .” Not all biometrics are created equal: “low-quality implementations create more issues, such as increased false acceptances, frustrating false rejections, and exploitable security vulnerabilities.” Facial biometrics, says NEC, offer high identity assurance levels and are nearly impossible to counterfeit. “With NEC’s advanced facial biometric technology , financial institutions can securely verify digital IDs in real-time, covering everything from digital banking apps to high-value transactions and administrative access.” Related Posts