Mobile fraud is when attackers target mobile transactions to carry out account takeovers, new account fraud, subscription fraud, payment fraud, disseminate spam, and more. It's imperative that businesses fight mobile fraud in order to protect themselves and their customers on the mobile channel.
Why is Mobile Fraud on the Rise?
The COVID-19 crisis is a ‘black swan’ event that will have a lasting impact on the way people interact with technology. With around 4 billion people living on lockdown, we are more attached to our mobile devices than ever, using them to work, shop, access entertainment and socialize. There has also been a big shift towards contactless and mobile payments, as people avoid the health risks associated with handling cash in stores that do remain open. Businesses are being forced to accelerate their digital transformation efforts and move towards a mobile-first model.
Fraudsters are becoming experts at attacking mobile channels and have been quick to intensify attacks to maximize returns in a changing digital landscape. Our panelists agreed that while content and ease of access are paramount for customers, for businesses security is key. In order to retain customers and survive the crisis, they must strike the balance between user-friendly mobile apps and sites with robust fraud prevention strategies that fight fraud without damaging the user experience.
Fraud in the time of COVID-19
Mass job losses and economic instability are likely to drive many more people into fraud. For example, Arkose Labs saw a significant rise in sweatshop attacks from Italy and Peru immediately after the countries went into lockdown, and this trend has been spotted elsewhere across the world.
Our panelists highlighted the fact that there is also an increased risk of friendly fraud as many legitimate customers try to recoup money via chargebacks, or take advantage of promotions by creating multiple new accounts. Some banks have lifted limits on contactless payments, which could potentially lead to an increase in payment card fraud.
To mitigate fraud, it is important to know your customer base and their behavior patterns. This allows fraud prevention systems to identify abnormal behavior, preventing at least 50% of fraud at the point of registration. Our panelists agreed that a multi-layered approach is necessary, combining risk profiling and authentication challenges to weed out fraudsters.
Fraud is ultimately a business, and profit is the main driver. To deter fraudsters from further attacks, fraud prevention solutions should sap their time and resources rendering attacks uneconomical.
Predictions for a Post-COVID Society
The COVID-19 crisis is set to have a lasting impact on commerce. Public anxiety over health risks is set to continue for a long time with face-to-face interactions potentially staying lower than pre-COVID times for many months. This will further accelerate mobile-first business models. Central to that strategy will be ensuring that mobile interactions are as secure and seamless as possible.
Please find a 1-page LISTICLE summarizing the top 5 insights from the panel here.
NEXT UP: Join us for our next virtual panel A Bounty on Your Head: Fraud in Complex Organizations where we will have guests from MICROSOFT, EXPEDIA INC., AITE GROUP, and THE PAYPERS to share the unique challenges of highly-targeted large enterprises.
Register here for our series: https://www.arkoselabs.com/digitalgathering/