Ecommerce companies, financial services firms and media organizations had better ready themselves for a wave of mobile fraud attacks. According to research released in March, bot-based automated fraud networks are increasingly shifting to mobile transactions to target a user base on the move.
The LexisNexis Risk Solutions Cybercrime Report, which covers the second half of 2019, found that automated fraud bot networks are becoming increasingly diverse and connected, with fraudsters spanning multiple countries and sectors. These bot networks can be huge. The largest during the reporting period spanned six countries and exposed $12.5m to fraud in one month, it said.
These bots attack organizations in various ways. They funnel stolen identity data from global breaches and use them for credential stuffing, where they try to log into online services with them. Other attacks include creating new accounts. This is a common way to move illegally obtained funds. This type of fraud is still one of the biggest cybercrime challenges for banks in the UK, it said, adding that globally, the financial services industry saw the highest proportion of new account creation attacks during the second half of last year.
Mobile users in the EMEA region are especially open to mobile attacks, according to the report, because of the relatively high penetration of mobile technology. 75% of transactions in this region are mobile compared to 67% globally, it pointed out.
Although mobile fraud is generally trending up, Lexis Nexis acknowledged that the dramatic rise in mobile activity in the second half of 2019 was down to one bot that tried to register millions of mobile apps. This shows how much impact automated malicious software can have on the overall fraud landscape.
These fraudulent networks are often highly distributed and connected. The company identified one UK-based banking fraud network that covered six countries in total including Canada, the US, and France. It also covered financial services, media and ecommerce. Another fraud network in Latin America also had links with North America, showing how connected these systems have become.
These criminal networks also tend to cover multiple types of fraud across different industries. The report identified one fraudster network that opened accounts at lenders and banks but also created accounts with ecommerce merchants and committed fraud via store pickup. Other criminal activities included digital gift card fraud on merchant websites and payment fraud using merchants' own payment card methods and multiple identities.
Media companies saw a big spike in fraudulent transactions. They had the highest proportion of identity spoofing transactions at 14.4%. Attackers are targeting companies in this sector because they make it easy to open accounts. They have become test beds for fraudsters that want to test stolen credentials.
When companies are hit by fraud, their customers often stop using them and switch to a competitor, the report concluded.