Report: Digital fraud attempts surge 18% in HK from pre-pandemic levels
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The volume of global digital fraud attempts increased considerably by 80% from 2019 to 2022, whereas digital fraud attempts originating from Hong Kong has increased 18% compared to pre-pandemic 2019.
Conducted by TransUnion, Hong Kong's credit reference agency, the report blends insights from the company’s global network and its consumer survey in 18 countries and regions to examine digital fraud trends and prevention strategies to enable trust in today’s Omnichannel marketplace.
The study showed that 17.5% of digital transactions were suspected to be fraudulent over 2022 in Hong Kong, the highest among all countries and regions studied. When looking at the volume, it generally mirrored the global uptrend, with an 18% increase in digital fraud attempts originating from Hong Kong compared to pre-pandemic 2019.
Among all industries, the logistics industry saw the highest growth rate in suspected digital fraud, up by 219% from 2019 to 2022. The insurance and communities industries also saw a significant increase in digital fraud attempts, up 204% and 131%, respectively, over the same period.
When looking at the figures globally, 4.6% of digital transactions analysed were potentially fraudulent in 2022, which was largely in line with the rate seen in 2019. However, despite the easing of digital fraud rate back to the 2019 level, the volume of global digital fraud attempts increased considerably by 80% from 2019 to 2022, alongside a marked increase in digital transactions during the same period.
Globally in 2022, the gaming and retail industries saw the highest rate of suspected digital fraud at 7.5% and 7.2% respectively. These were followed by video gaming at 5.4%, financial services at 4.2% and communities at 4.0%.
“The pivot to increasingly digital transactions since the onset of the pandemic means the overall risk facing consumers and businesses is even greater than before. As cybercriminals and fraudsters continue to evolve and become increasingly sophisticated, businesses need to step up and put in place robust fraud prevention measures to build consumer trust and safeguard their online experiences across digital channels,” said Jerry Ying, chief product officer at TransUnion Asia Pacific.
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Moreover, in a TransUnion-commissioned consumer survey across 18 countries and regions globally, 52% of respondents globally said they were targeted by digital fraud via email, online, phone call, or text messaging in the three months beginning September 2022.
Among Hong Kong respondents, 45% said they were targeted by digital fraud attempts across these communications channels, and 5% of all surveyed fell victim over this time period. Phishing, at 38%, was the most commonly reported fraud scheme experienced by Hong Kong consumers, followed by stolen credit cards at 27% and vishing at 22%. Across generations, Baby Boomers (73%), Gen X (64%) and Millennials (61%) appeared to be most concerned about vishing, compared to Gen Z who were most concerned about phishing (40%).
“The explosion of digital transactions, the accelerated adoption of digital technologies, and increasing appetite for faster access to digital services have all contributed to an increase in fraud losses. At the same time, while consumers want a fast and convenient online experience, they are also expecting businesses to protect their identities and online accounts. Businesses need to employ a strategy of continuous innovation through better data, analytics and technology to more accurately detect potential fraud, while at the same time delivering a friction-right digital experience for consumers,” said Ying.
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