“With the rush for businesses to go digital as many were forced to go completely online almost overnight, fraudsters tried to take advantage,” said Shai Cohen, senior vice president of Global Fraud Solutions at TransUnion. “They were most likely unsuccessful in their attempts and took their scams elsewhere as those businesses ramped up their digital fraud prevention solutions while providing a friction-right consumer experience. Conversely with consumers, fraudsters are increasingly using COVID-19 to prey on those persons who are facing mounting financial pressures.”

In contrast to the recent suspected fraud decrease against businesses, when comparing phase 1 (March 11-May 18) to right before the pandemic (Jan. 1-March 10), there was a 6 percent rise in suspected digital fraud against businesses. When comparing digital transactions pre-pandemic to during the pandemic (March 11-July 25), suspected fraud against businesses remained relatively flat, increasing one percent.

Examining Fraud Types and Their Impact on Industries

TransUnion analyzed the below industries for a change in the percent of suspected fraud against them, comparing the periods of March 11-May 18 and May 19-July 25.

Suspected Fraud Post-Pandemic Declaration

“It appears fraudsters assume travel & leisure companies are scrutinizing transactions less in order to capture more revenue as the pandemic continues to severely negatively impact their business,” said Melissa Gaddis, senior director of customer success, Global Fraud Solutions at TransUnion. “Another interesting note is that telecommunications, e-commerce and financial services companies – all industries that have fared relatively well during the pandemic – were targeted with the most digital fraud early in the pandemic but are now among the least targeted. This shows us that fraudsters initially targeted the hottest industries with the most money to be had early in the pandemic in order to hide behind the rush of transactions but have now made an obvious shift.”

Globally across industries, TransUnion found the countries with the highest percentage of suspected fraudulent transactions were: 1) Kazakhstan, 2) Greece and 3) Cyprus. In the U.S. overall, TransUnion found the cities with the highest percent of suspected fraudulent transactions were: 1) Livonia, Mich. 2) Akron, Ohio and 3) Jackson, Miss.

Consumers Targeted By COVID-19 Schemes

To better understand the impacts of COVID-19 on consumers, TransUnion surveyed 8,265 adults in Canada, Colombia, Hong Kong, South Africa the U.K. and the U.S. the week of July 27. More than three out of 10 respondents (32 percent) said they had been targeted by digital fraud related to COVID-19, with Gen Z (age 18-25) being the most targeted at 36 percent.

Among consumers reporting being targeted with digital COVID-19 schemes globally, the top pandemic-themed scam is phishing with 27 percent saying they were hit with it. Despite the survey showing Baby Boomers were the generation least targeted with Digital COVID-19 scams, among consumers reporting being targeted they were the age group saying they faced the highest percentage of COVID-19 themed phishing scams.