Digital fraud rising in Canadian financial services

New research finds 218% rise in suspected digital fraud attempts coming from Canada

Digital fraud rising in Canadian financial services

As the world looks to finish its war against the coronavirus by getting shots into arms, Canadians are continuing to conduct their banking and other financial transactions online – and cyber criminals are taking advantage.

Compared to the last four months of 2020, the percentage of suspected digital fraud attempts in financial services coming from Canada rose by 218% in the first four months of 2021, according to a new analysis from TransUnion. Over that same period, the rate of financial services fraud attempts globally rose by just 149%.

Looking across all industries, TransUnion found that suspected digital fraud attempts around the world rose 24% in the first trimester of 2021 compared to the last four months of 2020. Over that same period, the percentage of suspected attempts at digital fraud from Canada accelerated by 23%.

“The rate of fraud attempts are up globally and especially in the financial services industry because fraudsters understand this is where the most high value transactions are taking place,” Shai Cohen, senior vice president of Global Fraud Solutions at TransUnion, said in a statement. “We are seeing more financial services organizations implement fraud prevention solutions with some success, though our findings make it clear that this is not the time to relax.”

TransUnion also looked at the changes in percentage of suspected digital fraud attempts coming from Canada across different industries.

Travel and leisure companies saw the second-highest percentage increase of 50%, putting it far below the change for financial services firms. Telecommunications firms followed with a comparatively tame 22.25% rise.

The top type of digital fraud conducted in the financial services space across the globe, TransUnion said, was true identity theft – when a consumer uses an identity stolen from another person to commit fraud. The second and third most reported type of digital fraud by TransUnion financial services customers, it said, were first-party application fraud and account takeover fraud, respectively.

“We’ve seen a remarkable increase in financial services fraud in Canada, but other industries are facing far fewer suspected fraud attempts. In some cases, we are seeing a decline in such fraud attempts,” said Anne-Marie Kelly, head of Market Development, Identity Management and Fraud Solutions at TransUnion. “The key takeaway for businesses is that fraudsters do not treat every industry equally. They often pick and choose an industry to focus on based on the time of year or what businesses are seeing more transactional activity.”

“As the economy begins to open up and perform better, businesses need to do even better to ensure they are providing a secure marketplace that offers friction-right experiences to consumers,” Cohen said.

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