Online fraud doubles but UK fraudsters have less success than in rest of world
UK fraud attack volumes nearly doubled in 2022 as the scam-demic continues, according to the latest online fraud analysis published by LexisNexis Risk Solutions.
Around 36 million human-initiated fraud attacks were confirmed in the UK last year, a rise of 92% from the previous year. Globally the rate of growth was slower, at 56%.
The data also shows 352 million automated bot attacks on UK targets last year, an increase of 81% on the previous year. This means around 2% of all online transactions in the UK was a bot attack.
A bot attack is a large-scale automated cyber attack using sophisticated algorithms and automated scripts. Their objective can vary from disrupting an organisation’s website to phishing and smishing attacks designed to steal data. Recent bot attacks have been focussed on mass-testing people’s stolen login details.
These latest UK fraud figures are the result of analysing more than the 15.8 billion UK transactions processed by the LexisNexis® Digital Identity Network.
The figures represent good news for the UK financial services sector, showing that, despite rising fraud volumes, the UK attack rate – the number of successful attacks as a proportion of overall transaction volumes – is 0.2%, compared to a global rate of 1.3%.
The lower attack rate can be, in part, attributed to the UK’s advanced financial services market that invests billions per year on sophisticated tech-based fraud prevention solutions. High levels of mobile and app-based online banking service adoption is also helping reduce successful fraud attempts on UK customers.
Almost 9 in 10 (88%) UK financial services transactions are processed on mobile, with 89% of those occurring on apps.
Three types of fraud stood out in the UK analysis. Scams were the dominant type, accounting for two in five fraud attacks (38.2%), with first-party fraud representing another third (29.3%) and third-party account takeover fraud, another 13%.
Responding to the analysis, fraud and identity expert for LexisNexis Risk Solutions, UK & Ireland, Rob Woods commented, “These latest figures reveal a positive outlook for the UK’s ongoing fight against fraud. Despite rising overall volumes, this analysis shows that the UK’s highly-evolved and tech-enabled fraud prevention market is successfully mitigating fraud such as large scale 3rd party fraud, that is causing significant pain elsewhere in the world. Inevitably, other fraud typologies are emerging to fill this vacuum, including First Party Fraud – now a big problem in the UK. However, with continued adoption of AI-powered fraud analysis and shared intelligence, as well as more people accessing online services through secure mobile and app channels, the UK financial services sector is helping to significantly reduce the impact of fraud on its customers. As fraud attacks continued to increase during the past 18 months, financial institutions have responded well by focusing more on building trust with their loyal customer base, leading to higher levels of ‘trusted customer traffic’ that can be quickly authenticated and given access to online services, leaving more capacity for banks to focus on detecting and preventing malicious traffic.”
“However, whilst fraud attack rates are lower in the UK, they increased at a faster rate last year – at 44% compared to 20% globally – meaning that although the news is positive, businesses cannot afford to be complacent.”
To download the full UK fraud analysis report, visit https://risk.lexisnexis.co.uk/insights-resources/research/cybercrime-report-uk
