Report: Value of Attempted Fraudulent Purchases Skyrocketed 69% in 2020
SAN FRANCISCO, March 31, 2021 (GLOBE NEWSWIRE) -- Sift, the leader in Digital Trust & Safety, today released its Q1 2020 Digital Trust & Safety Index report, which revealed that the average value of fraudulent purchase attempts increased 69% in 2020. Sift also saw several business categories hit by both major increases in attempted fraud rates and increases in the value of those fraudulent purchases, with Lodging Merchants, Omnichannel Retailers, Digital Wallets, and Professional Marketplace companies becoming targets for online theft amid the COVID-19 pandemic.
Sift’s Data Science team also uncovered a sophisticated fraud ring, dubbed Cart Crasher by Sift, that leveraged guest checkout options on donation sites to attempt to launder stolen payment information. The group employed automated scripts to launch thousands of attacks on these sites through guest checkout options, which allow buyers to forgo the account creation process and only require a user’s email address before the user enters their payment information. The group’s innovative tactics demonstrate the ever-evolving nature of the Fraud Economy—a network of active cybercriminals with access to everything they need to exploit online businesses.
Specifically, Cart Crasher’s scheme, which was shut down across Sift’s global network, operated as follows:
Characteristics of Cyber-crooks
The Q1 2021 Digital Trust & Safety Index also found that while credit card transactions mke up the majority of e-commerce payments, the “fraudiest” payment methods were digitally native ones: online gift cards, store credit, cryptocurrencies, and in-app purchases. Similarly, the three most popular items sought by fraudsters across Sift’s global network were all digital goods: video game virtual currency, cryptocurrency, and site credits.
Other findings in the report include:
Fighting Back Against the Fraud Economy
“Amid the COVID-19 pandemic, we saw a decade’s worth of e-commerce growth condensed into a single year,” said Marc Olesen, President and CEO of Sift. “At the same time, cybercriminals were lying in wait, ready to take advantage of millions of vulnerable targets and enacting new methods to steal from them. As fraud fighters seek to stay ahead of the Fraud Economy, they must adopt a Digital Trust & Safety strategy, which ensures they can both protect against abuse while reducing friction for legitimate purchases.”
Sift’s Q1 2021 Digital Trust & Safety Index can be found here.
Sift is the leader in Digital Trust & Safety, empowering digital disruptors to Fortune 500 companies to unlock new revenue without risk. Sift dynamically prevents fraud and abuse through industry-leading technology and expertise, an unrivaled global data network of 70 billion events per month, and a commitment to long-term customer partnerships. Global brands such as AirBnB, Doordash, and Wayfair rely on Sift to gain a competitive advantage in their markets. Visit us at sift.com and follow us on Twitter @GetSift.
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