May 25, 2018 Philip Burgess
Fraudsters specialize in duplicity, and when identity theft is the aim, they seek out every available resource to accomplish their malicious agendas. Last year, they hit pay dirt on a frighteningly high number of occasions, a cautionary tale signaling to business owners and consumers about the importance of due diligence.
Approximately 16.7 million Americans in 2017 were victimized by identity fraud, according to analysis conducted by Javelin Strategy & Research. Up from 15.4 million in 2016, identity fraud has risen on a year-over-year basis five times in the last six years, based on Javelin's research.
Financial losses topped $16.5 billion
The amount of money people have lost to identity fraud also rose in 2017. Indeed, it cost the people victimized nearly $17 billion, up from $16.2 billion the prior year and $15.5 billion in 2015.
Al Pascual, Javelin Strategy & Research senior vice president and research director of the firm's fraud and security division, noted these criminals are constantly refining their strategies to outmaneuver what security systems may already be in place.
"2017 was a runaway year for fraudsters, and with the amount of valid information they have on consumers, their attacks are just getting more complex," Pascual explained. "Fraudsters are growing more sophisticated in response to industry's efforts to implement better security."
"Social Security numbers were targeted more than any other ID source."
From debit card information to credit card specifics, contactless payments to online portals, identity thieves have a variety of opportunities to steal consumers' highly sensitive information. And for the first time on record, Social Security numbers were targeted more than any other identification source, more so than even credit card data last year, Javelin found.
Another avenue fraudsters successfully pursued was account takeover. Compared to 2016, account takeovers tripled to a four-year high, resulting in financial losses of $5.1 billion, according to the analysis done by Javelin. That's a growth rate of 120 percent over the 12-month period.
90 percent of businesses worldwide adversely affected by data breaches
Businesses are also in fraudsters' crosshairs because many have databases that keep consumer records on file for faster transactions and processing. But companies, of course, have their own personal "eyes-only" data that can lead to financial ruin when it gets in the wrong hands. According to Kaspersky Lab, 90 percent of businesses globally have encountered at least once data security incident. Additionally, almost half - 46 percent - wound up losing sensitive data to these attacks, with third-party failure the most expensive form, ahead of fraud by employees and cyber espionage.
Pascual warned that the days of conducting transactions and engaging in online activity unprotected are over.
"Fortunately, there are a variety of digital tools to stay better informed on the status of their identities and accounts, and to ultimately stay better protected, Pascual advised.
"Two-factor authentification can serve as a smart security strategy."
Some of the more reliable strategies, which can be effective for business owners as well, include enabling two-factor authentication, securing all mobile devices with encryption technology and putting freezes on debit and credit cards if they're ever stolen. Security experts at Javelin also suggest implementing a credit freeze with all three credit bureaus, those being TransUnion, Equifax and Experian. There may be a fee to get this done, but it's usually no more than $20 with each bureau.
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