Fraud Predictions are Alarming, But Together We Can Help Reverse Them

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By Martina King
CEO, Featurespace

Fraud is nothing new. In fact, fraud has been with us from as far back as 300 B.C. when Hegestratos, a Greek sea merchant tried to sink his empty ship and claim back the nonexistent cargo of corn. Unlike many fraudsters however, Hegestratos’ plan backfired, and he came to a watery end.

Today things are very different. In our increasingly digital world, sophisticated criminal activity is taking advantage of individual and organizational vulnerabilities on an industrial scale. In the ACFE and Grant Thornton’s latest report, The Next Normal: Preparing for a Post-Pandemic Fraud Landscape, 51% of organizations have uncovered more fraud since the onset of the pandemic and 71% of respondents expect payment fraud to increase in the next year. Weaknesses in our global financial infrastructure and a lack of fraud consciousness are generating huge personal and institutional losses.

The outlook is not bright

Banking industry lobby group U.K. Finance recently declared that fraud in the U.K. has become ”a national security threat.” In the first half of 2021, more than 750 million pounds was stolen through fraud in the U.K. — that’s the same amount of money the U.K.’s Chancellor of the Exchequer granted to charities to help them recover from the pandemic. Perhaps that’s why the U.K. has been branded the “bank scam capital of the world.”

The rest of the world is experiencing similar increases in fraud. In the last year, Americans have lost nearly $30 billion to phone scams alone. In Singapore, nearly nine in ten merchants lost revenue due to payment fraud causing far reaching consequences to their businesses. In a report from FIS and Forrester, synthetic identity fraud and account takeover fraud were ranked top in causing operational losses.

In the December 2020 Nilson report, they estimate that by 2025, total payment card volume worldwide is projected to be $56.182 trillion, with gross card fraud globally expected to be $35.31 billion. More than ever before, all organizations — especially those that deal with payments and transactions — need to be proactive in their fight against fraud.

But…it’s not all bad 

One of the most resource-efficient ways to prevent fraud is to simply raise awareness of it. The ACFE’s 2020 Report to the Nations showed that fraud training for employees, or even just having a stated anti-fraud policy, reduced fraud losses by 38% and 33%, respectively, compared to organizations that did not have those controls. And luckily fraud awareness is on the rise through great initiatives like International Fraud Awareness Week.

While one organization raising fraud awareness still helps, it makes a larger impact when many organizations and individuals band together to educate others about fraud — and Fraud Week is the perfect opportunity to do so. As the world leader in fraud and money laundering prevention technology, Featurespace thought it essential to join forces with the ACFE and the hundreds of other fraud fighting heroes around the world to raise awareness of fraud and help reduce its impact.  

What we’re doing and how you can help

Anti-fraud messages are often most effective when you can show others the impact it has on organizations and individuals. To help raise awareness and protect more people from fraud, we have shared a series of stories, case studies and expert views during Fraud Week to help others understand different types of fraud — as well as offer advice and solutions.

But we can’t do this alone — we also want to hear from you and help share your ideas and stories so we can collectively raise awareness of fraud. IFAW@featurespace.com is a dedicated email address for you to share any whitepapers, articles and views that might help improve fraud awareness. We’ll share the best of these on our channels during the week.

So during this Fraud Week, we encourage you to raise fraud awareness in any way you can so together we can help protect society from fraud.