Fraud is a global problem, but it’s a problem that can look very different depending on where in the world it’s happening. According to data from Forter’s latest Fraud Attack Index, the type, frequency, and timing of attacks can vary significantly between countries and continents. Some of the fraud variations are logical, such as regional businesses being more vulnerable to attack during locally observed holidays, while others would almost seem to defy logic – until you look more closely at the causes. Here are six fraud factors you may not have thought about that can have a profound impact on regional fraud.
When it’s winter in the northern hemisphere, countries in the southern hemisphere aren’t the only things heating up. Travel and hospitality related fraud can also heat up as more people take to the skies in search of warmer weather. Add family vacations during the summer school break into the mix – plus the shopping spike at summer’s end for back-to-school supplies – and it’s easy to see why the summertime can be a popular time for credit card and other types of fraud.
It’s a well-known fact that fraud is higher during the holidays. Which holidays, however, depend on where you’re celebrating. Christmas is a magnet for fraud in much of the world, generating two of the busiest shopping days of the year in Black Friday and Cyber Monday. But did you know that one of the biggest shopping days in the world is China’s Singles’ Day on November 11th? Or that many countries celebrate a Children’s Day?
Data Breach Targets
Historically, U.S.-based businesses have been popular targets for data breaches, but that’s changing as more businesses in Europe and Asia Pacific report high-profile breaches. In 2018, for example, British Airways was hit with a $230 million fine for lost customer credit card data, while Hong Kong-based Cathay Pacific exposed personal data on millions of customers.
For better or worse, English has become the language of choice among fraudsters, even if it’s a second language for many of them. As a result, businesses that use English as their primary form of communication with customers can find themselves more vulnerable to fraud. It would be unlikely, for example, that someone would try to steal data from a Chinese company unless they had a working knowledge of Chinese.
Some types of fraud are limited by the physical realities of geography. While data theft may occur a continent away, online shopping fraud is far less likely to cross continents. But fraudsters frequently target other countries, particularly in regions such as Europe, where goods and services can easily cross borders.
Changing Regional Industry Factors
Forter’s Fraud Attack Index found some dramatic industry shifts in both rising and falling fraud across different regions. For example, fraud incidences among apparel and accessories retailers rose 60 percent in the Americas in 2018, but stayed virtually the same in the Asia Pacific (APAC) region. Meanwhile, fraud among digital goods dropped in the Americas by 23 percent, but rose by 21 percent in APAC. Among European jewelers, fraud dropped 14 percent but climbed 25 percent in the Americas. And while fraud among electronics retailers dropped by 37 percent in APAC, it rose 19 percent in the Americas. These are simply one-year trends, yet they underscore a regional sensitivity to fraud that defies broader industry trends.
In order to better prevent fraud, businesses need to look at both the macro and micro trends that affect their industry and their theater of operations. Where you do business can profoundly impact how and when you experience fraud. With a better understanding of regional fraud trends, you can expand your product offerings and services, as well as your business, without the fear of fraud.
The value of being a financially inclusive business is becoming far more important. In order to remain competitive, businesses need to ensure their fraud prevention solution is built to enable clients worldwide to access and receive their items, to be approved if they are truly legitimate, and more than anything else – to have a seamless shopping experience. It should be the goal of every merchant to be branded as a business that enables consumer experiences and shopping across the globe.
For more information on how the world of fraud is changing, download a copy of Forter’s Fraud Attack Index, Seventh Edition now.