U.S. is the Global Fraud Hotspot for the Holidays
With the holiday shopping season officially beginning in just a few days, global retailers can expect a 12% growth in online fraud compared to the same period of time last year, according to a recent study by ACI Worldwide. In the United States, fraud rates are expected to increase by 43% due to the adoption of EMV cards. Since these cards effectively deter in-store fraud, more criminals are going online.
Fraudsters are expected to go after less expensive items this year. In 2015, a trend began where fraudsters started targeting lower ticket priced items, and this is expected to continue in 2016 due to alternate shipping options, low-priced electronics and promotions. In America, attempted fraud average ticket value (ATV) is expected to decline from $239 to $219, an 8% decrease. Thieves may focus their efforts on cordless headphones, sneakers, cosmetics and other lower-priced items that can be resold via auction websites or on the black market.
Other key findings of the report, which was based on the analysis of hundreds of millions of global transactions, include:
- Card Not Present (CNP) fraud will increase globally by 12% during the holiday period, and sales are expected to rise at that same rate.
- Cyber Monday is expected to surpass Black Friday in sales this year.
- Fraud is expected to peak on Christmas Eve, which may be attributed to the popularity of gift cards and last-minute shopping with the buy online, pick-up in-store option.
“Fraud is increasing at a rate nearly equal to general retail growth globally—and is exponentially increasing in the U.S., due to a seismic shift from in-store to online activity,” said Mike Braatz, chief product officer at ACI Worldwide. “And because fraudulent activity is now considered to be an everyday occurrence, consumers and merchants must take every precaution as we head into peak holiday shopping season.”