Using anonymized data, insights were secured across online and offline payments channels, including P2P, ACH, wires, checks, and card transactions
NICE Actimize, a NICE (NASDAQ: NICE) business, has released “The 2022 NICE Actimize Fraud Insights Report” that identifies and analyzes the leading fraud threats and patterns that impacted leading global financial institutions in 2021. Noting that banking fraud continues to rise, the data-driven research study found a 41% increase in attempted fraud over a similar evaluation conducted the year before by its data scientists.
Leveraging NICE Actimize’s X-Sight AI, which utilizes Federated Learning techniques and collective intelligence to spot emerging threats and suspicious patterns of activity, the report was created by analyzing billions of banking and payments transactions representing over $110 trillion in value. NICE Actimize currently employs these techniques across leading financial institutions to monitor and stay aware of advancing fraud threats. Its data scientists and fraud subject matter experts compiled anonymized data secured from a subset of its total monitored transactions, including both online and offline payments channels that covered ACH, wires, checks, card purchases, and P2P transactions. The Fraud Insights Report aggregated and synthesized fraudulent activity patterns seen across a range of global financial institutions.
The NICE Actimize 2022 Fraud Insights report showed that increased utilization of mobile devices for everyday purposes, such as banking, shopping, and communication, heavily impacted the fraud landscape in 2021. Fraud increased across the board, from P2P payments and digital wallets to traditional check payments. Among NICE Actimize’s findings, mobile channels saw the highest increase in fraud attempts. NICE Actimize projects that mobile channels will continue to be a target throughout 2022.
Additionally, the Fraud Insights Report’s key findings also showed:
- Banking and payments transactions using mobile devices have increased substantially according to the report. But unfortunately, the popularity of mobile usage goes hand-in-hand with fraud – 61% of attempted fraud attacks through mobile apps are Account Takeovers (ATOs), the data showed.
- Fraudsters are exploiting the prevalence of mobile to target and leverage older devices. The report also showed that cell phones using older operating systems or made before 2016 have three times more fraud attempts associated with them than newer devices or operating systems.
- Nearly half (46.9%) of attempted fraud stemmed from card-not-present transactions across payment channels. As a result, online transactions presented a growing focus in the threat landscape.
Explains Craig Costigan, CEO, NICE Actimize, “Incidents of fraud against financial institutions and consumers continue to rise. For financial institutions to conquer these challenges, they must fully leverage data as the most important element of fraud prevention. World-class collective intelligence, with advanced analytics and AI, provides protections that safeguard banking channels while enabling more friction-free customer experiences.”
NICE Actimize projects that P2P transactions will emerge as a dominant challenge impacting the 2022 threat landscape as financial institutions continue to see an acceleration of digital-initiated transactions. In its findings, NICE Actimize noted that P2P fraud saw an increase of 63% in attempted fraud dollar value and a 38% increase in attempted fraud rate in the past year.
To download a copy of NICE Actimize’s 2022 Fraud Insights report, please click here.
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