The global digital attack rate increased 20% in 2022 compared to 2021, continuing the trend of digital fraud rising as economies re-open following the pandemic, according to a new report from LexisNexis Risk Solutions.
The company’s Identity Abuse Index, which records the percentage of attacks per day, shows attack rates fell in the fourth quarter of 2022.
The latest annual LexisNexis Risk Solutions Cybercrime Report is based on cybercrime attacks detected by the Digital Identity Network platform and processed 92 billion transactions in 2022, including common attack types such as new account creation, account login and payment fraud.
Despite the effects of economic uncertainty, inflation and the war in Ukraine, digital transactions in 2022 went up by 24% primarily driven by increasing transactions in financial services (29%) and ecommerce (17%).
Organisations are looking to establish consistent digital identity insights across all digital channels and end-customer touch points to mitigate rising fraud levels. They are striving to increase the level of trust with their customers, as well as identifying risk more easily.
The report showed that the percentage of transactions classified as trusted in the Digital Identity Network platform increased by 9%, allowing organisations to provide a smoother customer journey.
“Businesses remain vulnerable to transactional fraud during this time of accelerated digitalisation,” said Stephen Topliss, VP of fraud and identity strategy for LexisNexis Risk Solutions. “Despite heightened regulatory scrutiny, technological innovations and higher public awareness, there are persistent challenges in preventing fraud.
Topliss said this trend is likely to endure as consumers continue adopting digital channels. As fraud levels and its sophistication increase, relying on multi-factor authentication alone as a defense is inadequate in today’s digital world.
“Organisations, industries and countries must collaborate and identify the interconnected signals of complex fraud attacks because criminal networks working in a structured way are here to stay,” he said “Addressing the latest scams requires targeted machine learning models that can consume the latest digital intelligence insights, behavioral biometrics signals and mule account indicators.”
Findings also show that mobile transactions have reached a record high of 77% of all observed transactions in the Digital Identity Network, with the mobile app channel making up 82% of all mobile interactions.
Also, the global attack rate continues to increase, driven by an uptick in the financial services and e-commerce industries at 31% and 29% respectively.
The report shows that criminals continue to target the communications, mobile and media industries more than any other sector. However, a noticeable decline of 27% in the overall attack rate suggests criminals are changing focus.
In addition, attack rates on digital payments increased 27% across all desktop and mobile channels. Alternative payment methods, such as digital wallets, QR code payments and peer-to-peer transfers, continue to gain popularity, particularly in APAC.
The shift has contributed to the 32% growth in payment transactions in that region, yet criminals are also fast at exploiting vulnerabilities. The report shows a 50% YOY increase in APAC’s payment attack rate.
Further, automated bot attacks in the e-commerce space have grown 195% globally. Almost half of these attacks focused on the United States, where e-commerce focused bot attacks increased by 127%.
Bot attacks increased 112% in the US gaming and gambling industry, while the sector grows due to legalisation in more states.