The number of identity fraud victims rose 16 percent in 2016, marking the highest level since Javelin Strategy & Research began tracking the trend in 2003.
In a press release highlighting the results of Javelin Strategy & Research’s 2017 Identity Fraud Study, the research firm said that despite efforts by the industry, bad guys successfully adapted to net 2 million more victims in 2016. What’s more, the amount the fraudsters stole rose by close to $1 billion to $16 billion.
“After five years of relatively small growth or even decreases in fraud, this year’s findings drives home that fraudsters never rest and that when one area is closed, they adapt and find new approaches,” said Al Pascual, senior vice president, research director and head of fraud & security, Javelin Strategy & Research, in the press release. “The rise of information available via data breaches is particularly troublesome for the industry and a boon for fraudsters. To successfully fight fraudsters, the industry needs to close security gaps and continue to improve, and consumers must be proactive, too.”
According to the research, during 2016 there was a resurgence in existing card fraud, which saw an increase of 40 percent in card-not-present fraud. What’s more, the increase in EMV cards and terminals was a driver of shifting to fraud by opening new accounts. There was one good piece of news: While fraudsters are getting better at evading detection, consumers online are getting better at detecting fraud at a quicker pace.
Among the other findings of the report, in 2016, 6.15 percent of consumers became victims of identity fraud, an increase of close to 2 million victims from the year earlier. Card-not-present fraud increased by 40 percent, while incidence of fraud at the point of sale was unchanged from the levels seen in both 2014 and 2015. After reaching a low point in 2014, both account takeover incidence and losses rose notably in 2016, with total account takeover losses reaching $2.3 billion, a 61 percent increase from 2015, while incidence rose 31 percent.
“Account takeover continues to be one of the most challenging fraud types for consumers, with victims paying an average of $263 in out-of-pocket costs and spending a total of 20.7 million hours to resolve it in 2016 — 6 million more than in 2015,” Javelin’s research reported.