Spike in digital fraud, but consumers can be part of the solution - global survey

The bot attack rate for e-commerce businesses was significantly higher at 155%, according to the LexisNexis Risk Solutions’ first Global State of Fraud and Identity Report released on Tuesday.

The survey included interviews with almost 3,000 risk and fraud executives in retail, e-commerce and financial services/lending across the globe over the last year. 

“Digital fraud has continued to grow as economies around the world re-opened in 2022, as we anticipated in our H2 2021 Cybercrime Report based on early trends in the United States, Europe, the Middle East and Africa.

“The latest surge in scams shows how the fraud landscape will continue to morph. Organisations need to use flexible fraud prevention models coupled with an adaptive authentication approach,” says Stephen Topliss, vice-president, fraud and identity, at LexisNexis Risk Solutions.

Topliss says a solution approach deep in layers, combining behavioural biometrics with global digital identity data and risk-appropriate authenticators, enables businesses to confidently make risk-based decisions while delivering a friction-appropriate customer journey.

The report demonstrates how digital transactions dominated the global marketplace as the pandemic-driven trend of consumers migrating to online interactions became commonplace behaviour.  

Pandemic-driven digital transaction growth continued to attract fraud attacks, with global businesses recording a 32% jump in the human-initiated attack rate over the past year, while high-velocity automated bot attacks were up 38% year on year.

Shifts to mobile channels continued to increase, reaching 76% of all transactions in the digital identity network. Consumers today use an average of four connected devices to facilitate digital economy transactions. 

The addition of new e-commerce channels via marketplaces and within the wider banking ecosystem, along with a proliferation of payment options such as Buy Now Pay Later (BNPL), digital wallets and QR codes, contributed to a growth in transactions across mobile channels.

As consumers adopt multiple digital channels and payment formats, they expect a positive experience and trusted security measurements at every touchpoint. Identification and authentication solutions across the entire customer journey are becoming mandatory, as fraudsters build attack strategies at every stage. 

The report reveals that one in 12 new account openings, and one in 20 password resets, represent an attack.

“Cybercriminals quickly launch complex attacks on the weakest link in the omnichannel network, targeting individuals who are newer to transacting online with less cybersecurity awareness, while targeting companies that – in their rush to provide consumers with digital transaction options – have not deployed adequate defences,” Topliss says.

• Fraud evolves with new payment methods: Increased adoption and strong demand for contactless payment methods are major contributors to the rise of QR code fraud. BNPL is gaining traction globally, leading to an increase in new account opening fraud.


• Risks in the digital ecosystem: Fraud networks are increasingly pervasive in the omnichannel digital ecosystem leading to a dramatic rise in scams including social engineering, identity theft, password reset and account takeover fraud. The escalating risk of account takeover fraud is one of the biggest threats, as mobile app login attack rates increased 211% year on year.


• Identity verification remains the top hurdle: Customer identity verification remains a top challenge for global businesses, which cited limited real-time third-party data (46%) and limited real-time transaction tracking (43%) as the two biggest challenges when it comes to verifying customer identity in online channels.