SAN FRANCISCO–The costs to consumers from identity fraud losses have more than doubled and account takeovers are proliferating, according to the 2020 Identify Fraud Report from Javelin Strategy & Research.
The study also offers insights into how sloppy security practices are contributing to the problem.
The study, conducted in conjunction with the AARP, FIS and Allstate Identity Protection, is the nation’s longest-running independent study of ID fraud, dating back to 2003. The report highlights important data pertaining to financial institutions, their customers/members and their regular operations.
The findings indicate there has been greater fraud losses related to ID theft, but fewer victims.
The Findings
Among the findings:
- Total identity fraud reached $16.9 billion (USD) in 2019, up 15% from 2018
- Total fraud victims totaled 13 million, which is down 10% from 2018
- Consumer out-of-pocket costs more than doubled over 2018, totaling $3.5 billion
- Account takeover is rising aggressively as fraudsters seek to take full control of compromised accounts and maximize their payout
- Even as other fraud types remained steady or fell from 2018, account takeover grew from 3.6 million victims in 2018 to 4.4 million in 2019
- · Javelin said trust in banks—it did not break out credit unions separately—is flat as consumers are not embracing bank security
- Confidence in the security of digital banking and payments has plateaued. “Even as consumers have ubiquitous access to strong authentication, just 60% of consumers believe online banking is secure--50% for mobile banking,” said Javelin.
- Apathy is the key opponent for strong authentication. “Some consumers don’t use biometrics when logging into online banking because it is either not available on their device or mobile banking. Instead consumers are most likely to prefer their current authentication methods, or simply haven’t considered switching.”
- Consumers age 55+ are at greater risk of bank fraud, with more than half of this cohort misusing their checking or savings accounts