TMCnet News
Retail Fraud Transactions Up Sharply Year Over Year, With Online Channels and Sales of Digital Goods Driving Fraud Increases, according to new LexisNexis Risk Solutions Retail ReportATLANTA, Dec. 6, 2017 /PRNewswire/ -- Today, LexisNexis® Risk Solutions released its comprehensive 2017 True Cost of Fraud? report, for the retail sector. The study includes a survey of over 650 risk and fraud executives in multichannel retail organizations, and details current trends in retail fraud and the effects these have on the ability of merchants of all sizes to prevent and catch fraudulent transactions. A central feature of the report, the LexisNexis Fraud Multiplier?, estimates the total amount of loss a merchant incurs, based on the actual dollar value of a fraudulent transaction. This year, every dollar of fraud cost merchants $2.77, up from $2.40 a year ago, according to the Fraud Multiplier tool. Also, the report finds that the volume of fraud has risen sharply in the last year—from a monthly average of 206 to 238 successful fraudulent transactions, and from 236 to 257 prevented fraudulent transactions—while the level of fraud as a percentage of revenues has also inched upward from 1.47 percent to 1.58 percent. What's driving fraud increases are merchants with online channels and sales of digital goods, particularly where they have international transactions. The cost per dollar of fraud, among merchants with international transactions is significantly higher than those merchants with domestic-only transactions. This coincides with the rise in account hacking and takeovers. Beyond this, new access channels and payment methods, including mobile walets, the U.S. EMV rollout, and digital channel applications have all made the regulatory and payment landscape more challenging for merchants. Notes LexisNexis Risk Solutions vice president of fraud and identity management strategy, Paul Bjerke: "With online fraud outpacing reported growth in e-commerce sales volume, we can point to EMV implementation at physical retail stores as a cause. Also in the digital space, botnet fraud also has risen dramatically, which correlates with the rise in e-gift card volume and fraud." Other findings of the report include:
The study also looks at merchant attitudes toward fraud prevention and the challenges they face. Observes Kimberly Sutherland, senior director, fraud and identity management strategy, LexisNexis Risk Solutions: "Merchants selling physical and digital goods often apply a one-size-fits-all program to fight fraud, and they use a limited set of solutions. These less advanced and less sophisticated legacy solutions do not appear to be working, given the sharp rise in costs and volume of successful fraud attempts." 2017 LexisNexis® True Cost of Fraud?Study Methodology About LexisNexis® Risk Solutions Media Contact Jean Creech Avent View original content with multimedia:http://www.prnewswire.com/news-releases/retail-fraud-transactions-up-sharply-year-over-year-with-online-channels-and-sales-of-digital-goods-driving-fraud-increases-according-to-new-lexisnexis-risk-solutions-retail-report-300567868.html SOURCE LexisNexis Risk Solutions |