Digital trust-and-safety company Sift said that 2020 has been a “banner year” for online shopping sales, but that scammers have modified their approaches to take advantage of the boom, according to an announcement.
The company said that malicious actors are moving away from the usual “spray and pray” strategy that entails conducting dozens or hundreds of lower-value transactions with stolen payment data, and are instead making fewer and larger attacks.
Cybercriminals have been homing in on eCommerce retailers that are seeking to capitalize on the rise of online shopping this season, as they believe that “they will be more likely to get through unabated,” the company said.
“The opportunity for eCommerce merchants this holiday season is greater than ever, and fraudsters have certainly taken advantage by making fraudulent transactions at higher price points,” Sift CEO Jason Tan said in the announcement. “Cybercriminals are well aware that merchants are setting higher thresholds for blocking transactions, which is a major flaw of rules-based fraud prevention strategies.”
He said rules-based systems often fail to find high-dollar fraudulent transactions, but do often block legitimate transactions along the way.
“Companies need to move toward a digital trust and safety strategy that accounts for the changing behaviors of fraudsters while ensuring a seamless experience for legitimate users,” Tan said.
Digital fraud is a longstanding issue for retailers and banks. As PYMNTS’ latest Digital Fraud Tracker recently reported, shipping fraud grew 391 percent between 2018 and 2019, while account takeovers spiked by 347 percent over the same timeframe. The pandemic has only made these issues worse.
Furthermore, 22 percent of Americans have reported being targeted by COVID-related fraud.