95.4% of online traders affected by fraud

CRIF AG has carried out a survey of Swiss online and mail-order companies on the subject of fraud, in collaboration with the HANDELSVERBAND.swiss trade organisation. Over 95% of all the traders questioned declared that they had been affected by fraud on at least one occasion in the past. One third registered an increase in attempts at fraud during lockdown.

47.8% of those taking part in the survey either said that the level of fraud had increased, or that it had increased sharply in comparison with 2019. For 45.5% of those questioned, nothing much had changed in this regard since the previous year.

Increase in the amounts lost

The majority of those questioned, namely 70.7%, estimated that their maximum loss amounted to under CHF 5,000.

Nevertheless, individual losses of between CHF 5,000 and CHF 25,000 had risen in comparison with 2019. In the case of losses of between CHF 5,000 and CHF 10,000, this rise amounted to +4.6%; there was also an increase of +3.8% in losses of between CHF 10,000 and CHF 25,000. Furthermore, 4.6% of the traders recorded a loss of over CHF 100,000 in the past 12 months. This figure is up by a third compared with 2019.

Identity theft has increased

Identity theft has increased by 13% in comparison with 2019, and is identified as one of the most frequent forms of fraud by 70.5% of all those questioned. Other popular types of fraud include people who order goods, even though they know in advance that they cannot pay for them, and people who buy goods using forged details. Attempts at fraud using stolen payment information were also twice as common as in the previous year, at 15.9%.

The use of fraud detection methods is increasing

Over 93% of the traders questioned state that they implement fraud detection procedures. The majority (. 84%, ) check any suspicious orders manually. A variety of blacklists and fraud filters are also popular in the battle against fraud. The application of device fingerprint technologies has doubled in comparison with 2019, while transaction tools were used three times as often as before. In 2019, a third of the traders indicated that they either undertook fraud prevention measures themselves, or that they outsourced this task to external service providers; by 2020, this ratio had risen to 50%.

Two thirds of the traders reported that the number of fraud attempts fell, thanks to the use of fraud detection methods.

This finding is also confirmed by Daniel Gamma, Director of E-Commerce at CRIF: “It is well worth the effort for online traders to constantly enhance their fraud prevention measures. Traders are also increasingly outsourcing their fraud prevention function to external service providers who offer transaction tools. CRIF is therefore developing this area on a continuous basis”.

Source: https://www.crif.ch/en/news-and-events/news/2020/november/crif-study-on-fraud-in-online-trading/