Mitek Systems Inc.

12/03/2024 | News release | Distributed by Public on 12/04/2024 00:42

The holidays are here—and so are the fraudsters: how to stay protected

December 3, 2024

The holiday season brings joy, celebration, and generosity-but it also brings a sharp increase in fraud. Cybercriminals and scammers take advantage of the chaos of holiday shopping, year-end activities, and increased online transactions to target both individuals and businesses. Mitek, a leader in identity verification and fraud prevention, wants to ensure you're prepared to recognize and fight back against these threats.

Why fraud peaks during the holidays

Fraud surges during the holidays because of a perfect storm: higher transaction volumes, distracted consumers, and businesses rushing to meet increased demand. According to a recent study by McAfee, 59% of shoppers reported encountering fake "missed delivery" alerts, fraudulent holiday deals, or account-related scams. With the rise of AI-powered schemes, such as deepfakes and phishing emails that mimic legitimate brands, staying vigilant has never been more critical.

Key types of fraud to watch out for

1. Digital identity fraud

The hustle and bustle of the holidays tends to rely heavily on fast, frictionless customer experiences-but this creates opportunities for identity thieves. Fraudsters use stolen credentials or synthetic identities to make unauthorized transactions. Mitek's identity verification solutions ensure that businesses can verify customer authenticity, preventing fraudulent transactions before they occur.

2. Holiday shopping scams

From fake "too-good-to-be-true" discounts to fraudulent online stores, scammers target deal-seekers. A Forbes article warns about the rise of Black Friday AI scams, where criminals use advanced tools to create convincing fake ads, websites, and social media campaigns. Always verify the legitimacy of deals and sellers before clicking.

3. Delivery and gift card fraud

Fake delivery notices and gift card scams are perennial holiday threats. Be cautious of emails or texts claiming a missed package delivery that ask you to provide personal or payment information. The BBB's "12 Scams of Christmas" highlights how these schemes evolve each year.

4. Business Email Compromise (BEC)

Businesses face a unique set of threats, including fake invoices, phishing emails, and fraudulent vendor requests. Fraudsters exploit year-end pressure and increased workload to trick employees into making unauthorized transactions. Robust identity verification and employee training can help prevent these costly mistakes.

Extra time over the holidays? Download and read the new Digital Fraud Playbook

How to protect yourself and your business

For individuals:

  1. Monitor your accounts: Check your bank and credit card statements regularly for unauthorized transactions.
  2. Enable multi-factor authentication: Add an extra layer of security to your accounts.
  3. Be skeptical: If a deal seems too good to be true, it probably is. Verify offers and websites before making a purchase.
  4. Send checks securely: Use tamper-proof envelopes and mail checks directly at the post office or inside a secure mailbox to minimize the risk of interception.
  5. Use trusted resources: Read tips on protecting your identity during the holidays from Experian and the FTC.

For businesses:

  1. Implement identity verification tools: Mitek's solutions can help you identify fraudulent transactions in real time
  2. Educate employees: Provide training on recognizing phishing emails and other social engineering tactics
  3. Secure your systems: Ensure your business's software and systems are up to date and protected against vulnerabilities.
  4. Adopt a sophisticated check fraud solution: Use bank-provided solutions to detect and prevent unauthorized or altered checks from being processed.
  5. Stay informed: Keep up with evolving fraud tactics through resources like the LA Times' "Season of Scams", McAfee's 2024 Global Holiday Shopping Scams Study, and Abrigo's Holiday check fraud: Protecting customers and financial institutions.

The future of holiday fraud

As fraudsters adopt AI to create increasingly convincing scams, businesses and individuals need to stay one step ahead. Technologies like biometrics, real-time identity verification, and check fraud detection are critical in the fight against fraud.

This holiday season, don't let scammers steal your joy-or your money. Take precautions, stay informed, and leverage tools like Mitek's fraud prevention solutions to ensure a safe and secure season.

For more tips, insights, and a little fun, check out:

Stay safe, and happy holidays!