Experian released its 2024 Future of Fraud Forecast, which identifies five fraud threats consumers and businesses should be cautious of this year.
Today’s fraudsters are sophisticated and will “deploy the latest technology, such as generative artificial intelligence, to dupe consumers and businesses.”
According to an Experian report, “nearly 70% of businesses report that fraud losses have increased in recent years and over half of consumers feel they’re more of a fraud target than a year ago.”
To thwart fraudulent activity in 2024, businesses need “to deploy more sophisticated fraud protection solutions that harness the power of data and technology to mitigate risk and protect consumers.”
Experian suggests consumers and businesses watch out for these five fraud threats in 2024:
- Generative AI accelerates DIY fraud: The explosive popularity of generative AI has brought many benefits, but it’s also made fraud more accessible. Experian predicts fraudsters will use generative AI to accelerate “do-it-yourself” fraud with a wide range of deepfake content, such as emails, voice and video as well as code creation to set up scam websites and perpetuate online attacks. Fraudsters may also use generative AI to socially engineer “proof of life” schemes. Using stolen identities, fraudsters will leverage generative AI to create fake identities on social media.
- Branches are cool again: Although there’s been a substantial migration to digital lending experiences, many consumers are heading in-person to bank branches to open new accounts or get financial advice. Consumers are doing this as they want to feel safer and think they’re avoiding online security risks by being in-person.
- Retailers hit with empty returns: With a rise in online shopping, fraudsters have found creative ways to scam some retailers and small businesses. The customer says they’re returning their purchased item but when the business receives the box, it’s empty. The customer then says they returned the product and it must have gotten lost in the mail. Experian predicts that more criminals will use this method to keep merchandise in 2024, leaving businesses with lost goods and revenue.
- Synthetic identity fraud will surge: During the pandemic, many fraudsters created synthetic identities but then quickly found easier methods to steal funds through various aid programs. Though they may have been dormant, these synthetic identities now have a few years of history. Experian predicts this will make it easier to elude detection — leading to fraudsters using those dormant accounts to “bust out” and steal funds over the next year. Businesses will need to collaborate more closely than ever with their fraud-prevention partners to review their current portfolios for synthetic identity accounts.
- Fraudsters expand into cause-related and investment deception: From fake GoFundMe campaigns, social media giveaways, investment opportunities and text fraud, fraudsters are employing new methods that strike an emotional response from consumers with cause-related asks or too-good-to-be-real offers to gain access to consumers’ vital, personal information. Experian predicts that these deceptive cause-related methods will surge in 2024 and beyond.