Brace for an uptick in fraud attempts this holiday season

Merchants aren’t the only folks angling to do a brisk business this holiday season. Crooks are upping their games, too. The electronic payments company ACI Worldwide is projecting a 14 percent increase in fraud attempts between Thanksgiving and New Year’s Eve, and a 17 percent increase in the value of attempted fraud.

“The first step to fighting fraud is knowing what you’re up against,” said Erika Dietrich, global director for payments risk at ACI. “Fraudsters prepare for the peak holiday season just as much as merchants and consumers do. By anticipating the increase in fraud during the holiday shopping season, and being aware of where fraudsters may be lurking, consumers and merchants can get ahead of fraudulent activity and protect themselves.”

ACI’s 2018 Holiday Season Merchant Fraud Forecast, based on transaction trends involving leading global retail brands, projects purchase volume this holiday season will increase 18 percent over 2017 totals. But attempted fraud rates will grow, too, and the average ticket of attempted credit card frauds is expected to rise by 3 percent, from $236 to $243.

Average ticket prices up

As the EMV security protocol makes card-present fraud harder to perpetrate, Dietrich said, overall fraud attempts will increase at a slower pace than in the past two years. But, she noted, “[A]s more consumers purchase big-ticket items like smartphones, TVs and other electronics, we expect attempted fraud average ticket prices to be higher this year than in previous years.” Fraudsters will also be keeping a watchful eye on items that have limited inventory so they can steal them for selling on the back market, she added.

Cross-channel frauds are also expected to grow. In addition to traditional online channels, buy online for in-store pickup and call centers will be areas of increased focus for fraudsters, according to ACI’s analysis.

Here are additional projections form the ACI report:

• The volume of fraud attempts will increase by 14 percent and the value of fraud attempts by 17 percent between Thanksgiving and Cyber Monday.
• 1.80 percent of transactions on Thanksgiving Day are expected to be attempted frauds.
• 1.30 percent of transactions on Black Friday are expected to be fraud attempts.
• 0.93 percent of transactions on Cyber Monday are apt to be fraudulent.

Editorial Note: The Green Sheet Inc. will be closed Thurs., Nov. 22 and Fri., Nov. 23, 2018, to observe the U.S. Thanksgiving holiday. We hope you enjoy the long weekend and look forward to hearing from you upon our return on Mon., Nov. 26.

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