Half of Gen Z targeted in digital fraud attempts
TransUnion’s Consumer Pulse Study has found that a third (33%) of UK consumers say they have been targeted in a digital fraud attempt related to COVID-19 in the last three months, though just 4% fell victim to the scams. This represents a steady increase from when the pandemic began, with just under a quarter (24%) saying the same in April 2020, with 6% falling victim.
Gen Z adults, born 1995 to 2002, are the most targeted by fraudsters out of any in the UK, at 51%. They also appear to be more likely than other generations to have fallen victim, with 19% of the identified scams being successful. They are followed by Millennials, with 37% having been targeted in a digital fraud attempt and 16% of those becoming victims.
Among consumers in the UK targeted with digital fraud related to COVID-19, the most common scam is phishing, accounting for just under half (48%) of fraud attempts.
“The COVID-19 pandemic has been yet another example of fraudsters looking to take advantage of a significant world event and use it to scam UK consumers. The almost overnight transition online brought about by stay-at-home orders catapulted the country’s digital acceleration like we’ve never seen before,” said John Cannon, managing director, fraud and ID at TransUnion in the UK. “As we see digital fraud impacting a substantial portion of the population, it’s important to keep in mind the significant progress made in protecting businesses and consumers from attempts like this. In fact, UK Finance notes that while fraud volumes have increased in the last year, overall financial losses saw a decrease of 5% compared to 2019.”
Gaming industry fraud
The online gaming industry is a prime example of an industry facing rising numbers of transactions as in-person options for participation were closed off and overall participation from consumers rose through the year. Unfortunately, this was accompanied by rising fraud rates. Through its TruValidate solution, TransUnion documented 19% growth in transactions among its global iGaming customers from 2019 to 2020, likely due to an increase in activity on customer platforms, and recently researched its fraud impact in a special report. Globally, it determined that its online gambling customers experienced a 9% increase in the rate of suspected fraud among the 576 million iGaming transactions TransUnion analysed for risk indicators last year.
This growth aligns with industry figures which registered a significant increase in UK consumers gambling online last year. In the year to December 2020, nearly a quarter (24%) of UK adults had gambled online in the previous four weeks, up from 21% in 2019.
Adam Hancox, head of gaming for TransUnion in the UK and Europe said: “As more people turn to online platforms for gaming, either as a natural evolution of their engagement with the industry or as a result of COVID-19 limiting the chances for betting in person, it’s absolutely crucial that providers are operating a protective, secure environment. Recognising an increase in fraud attempts in gaming, as well as the high rate of consumers reporting digital fraud attempts, operators need to ensure they are keeping pace with the latest technology and fraud prevention solutions.”
As iGaming on mobile devices is still much higher than desktops, with the percentage of online gambling transactions coming from mobile devices at 69%, this will be a priority area of focus for gaming operators in the coming months.