PH travel and leisure fraud soars 69.1%

·3 min read

THE continuous growth of e-commerce could be behind a surge in shipping fraud, which is now the fastest growing type of digital fraud worldwide, according to the TransUnion’s 2022 Global Digital Fraud Trends Report.

TransUnion observed an influx in shipping fraud in 2021, resulting in a 780.5 percent year-over-year (YoY) global increase. When compared to a two-year time frame from 2019 to 2021, TransUnion data shows shipping fraud grew more than 1,500 percent.

“As consumers shifted from brick-and-mortar retailers to e-commerce platforms over the course of the pandemic, fraudsters gravitated toward where consumers were increasingly spending both time and money,” said Shai Cohen, senior vice president and global head of fraud solutions at TransUnion. “Online shopping has become the ‘new normal’ on a global scale and as a result, the propensity for shipping fraud has also increased.”

As consumer adoption of digital channels has continued to accelerate, the global rate for all types of suspected digital fraud attempts increased 9.4 percent YoY from 2020 to 2021 and 52.2 percent from 2019 to 2021.

In addition to shipping fraud, other types of fraud that experienced large increases when comparing 2020 to 2021 include business identity theft (+113.8 percent) and identity mining/phishing attempts (+104.8 percent) which both showed high rates of annual growth.

Philippine setting

For transactions originating from the Philippines, the travel and leisure industry saw the largest percentage of annual fraud growth in 2021, with an increase of 69.1 percent YoY.

Communities (including online dating, forums, etc.) (18.2 percent) and gaming (11.6 percent) were the second and third industries with the largest growth in the rate of suspected digital fraud attempts.

Globally, financial services, and travel and leisure ranked as the top two industries with the largest growth in the rate of suspected digital fraud attempts during the same time period.

This became especially prevalent as economies normalized from the height of the pandemic and tourism resumed.

Digital fraud in the travel and leisure sector saw the greatest YoY increase and grew 68.4 percent with credit card fraud as the predominant type.

Digital fraud in financial services remains a prime target for fraudulent activity worldwide and grew 33.5 percent YoY, making it an increasing area of concern for businesses and consumers alike.

“While advances in digital banking and e-wallet services in the country have enabled more Filipinos to formally participate in the financial system, our findings point out that fraudsters have shadowed the shifts in consumer behavior in attempts to take advantage of the disruption,” said Pia Arellano, president and chief executive officer of TransUnion Philippines.

“As consumers value both a seamless user experience as well as security, it is imperative that businesses view fraud solutions not only as defensive measures, but also as instruments in aiding customer acquisition and retention. This approach helps improve the onboarding experience and facilitates a bedrock of trust between businesses and consumers,” she added.

The TransUnion’s 2022 Global Digital Fraud Trends Report surveyed 12,500 adults worldwide in the United States, Brazil, Canada, Chile, Colombia, the Dominican Republic, Hong Kong, India, Kenya, Mexico, the Philippines, Puerto Rico, South Africa, Spain and the United Kingdom. (KOC)

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