Fraudsters Shift Focus from Finance to Gaming, Leisure
Many might expect that fraudsters, hackers, and scammers would primarily seek to target the financial sector to make off with large sums of money at the expense of others. After all, an industry directly involved in the transfers and storage of funds would appear to be the most obvious place criminals could garner potential profits. While this belief has held true historically – specifically with the rise of online banking and the subsequent growth of cybercrime – it appears a changing of the tides has occurred coinciding with the onset of the COVID-19 pandemic, one that has seen fraudsters shifting their focus from the financial realm to branching out to other lucrative industries, including entertainment and hospitality. A new study by credit reporting company TransUnion has shown that scammers are now targeting the gaming (i.e. video games) and travel industries at unprecedented levels. In the second quarter of 2021 alone, online fraud attempts have increased across the board by 16.5% globally as compared with the same time frame in 2020 (with U.S-based incidents rising 17.1%).3 While fraud affecting the financial services industry did rise approximately 18.8% during this period, all told the largest increase occurred in the two aforementioned industries. In Q2 of the 2021 fiscal year, gaming fraud increased by a whopping 393.0%, with travel/leisure fraud increasing by a 155.9%.1 Social media and retail were also popular targets of fraud ploys. The figures backing the shift are striking, though not totally unexpected to financial analysts and risk management firms. Shai Cohen, senior vice president of Global Fraud Solutions at TransUnion. “It is quite common for fraudsters to shift their focus every few months from one industry to another,” says Cohen. “Fraudsters tend to seek out industries that may be seeing an immense growth in transactions.”1 Due to the COVID pandemic, scammers have already dipped their toes into other industries that have been impacted, and have sought to capitalize on other avenues such as the exploitation of unemployment benefits and the novel paycheck protection program (PPP) enacted to provide relief to American citizens and business owners who had difficulty keeping their heads above water during mass lockdowns and a period of unprecedented job loss. TransUnion’s report also found that one out of every three online consumers has been targeted by online fraud related to Covid-19, with approximately 1/3 of those targeted being successfully defrauded.2