New research from Javelin Strategy & Research’s 2017 Identity Fraud Report knits an intricate relationship between consumer personas and identity crime risks.
In 2016, an estimated 15.4 million consumers were victims of identity theft and fraud, up from 13.1 million the previous year. This marks the highest identity victimization rate since Javelin Strategy & Research began tracking the trend in 2003.
EMV adoption was a driving force behind the spike. The move to more secure chip cards motivated criminals to shift to other fraud methods. Consequently, schemes such as account takeover and card-not-present fraud saw double-digit growth in 2016.
New this year to the study, Javelin identified four consumer personas to understand their unique fraud risks. They selected offline consumers, social networkers, e-commerce shoppers and digitally connected consumers to explore fraud patterns. These consumer personas offered key insights into the indiscriminate nature of fraud. They are also essential for mapping out identity crime reduction initiatives for various consumer groups within your financial institution.
Consumer Persona Breakdown:
This consumer persona does not participate in social networking, e-commerce or other online activities. They aren’t on board with your mobile banking app and still opt for in-branch visits.
Their Internet aversion comes in handy, as it reduces cybersecurity risks and the amount of sensitive personal information that’s publically available. However, since offline consumers steer clear of online banking, they take longer to detect fraud (40 days on average) and incur higher average fraud losses.
This consumer persona responds best to in-branch fraud prevention materials. They also face unique restoration challenges in the event of fraud, including an increased risk of future fraud, due to their extended exposure window. Address these concerns with a comprehensive restoration plan that’s administered by a real person.
They tweet, they text — but they’re rather apprehensive when it comes to online shopping. You’ll find this consumer persona on your company Facebook page giving their two-cents and a well-deserved “like” from time-to-time.
Fraudsters love this consumer persona for making their job as simple as a Google search. For example, a criminal is often presented with a security question when attempting to hack an online shopping account. Ten years ago, “what was your high school mascot?” was hard to guess. Now, thanks to social media sites, that information is easier than ever to find.
It’s no wonder Javelin found that social networkers face a 46 percent higher risk of account takeover fraud.
This consumer persona responds best to their financial institution through social media engagement. Great anti-fraud shares include timely tips, scam news and other educational content.
Keep an eye on monthly account transactions to spot this spend-happy consumer persona. These savvy shoppers aren’t protected by the push to EMV as their transactions take place on the web where chip technology is irrelevant. This creates the perfect platform for card-not-present fraud to thrive.
There’s good and bad news when it comes to e-commerce shoppers. The bad? They experienced the highest incidence of fraud of any of the personas. The good? They caught fraud quickly (78 percent flagged fraudulent transactions within a week). This quick action significantly minimized impact.
Consider a comprehensive identity protection offering for this high-risk consumer. It should include Internet monitoring services, which proactively scan known black market websites for signs their personal or financial information has been compromised. This compromise is often linked to their online activities or due to a data breach at one of their favorite online retailers.
Rarely seen, often heard. This consumer persona has an extensive social media presence, frequently shops online and is an early-adopter of new technology. One in four digitally-connected consumers used a Peer-to-Peer (P2P) payment service, a technology that allows individuals to transfer funds from their bank account to another person’s account via the Internet or a mobile phone, in the past week.
These consumers carry the same risks of both social networkers and e-commerce shoppers, resulting in a 30 percent greater risk of fraud.
The first step in cracking down on their identity risks? Tackle their abundance of online information. Introduce a Password Manager and encrypted online data storage to help address their daily security concerns. These features should be accessible on an online and mobile interface.
Your Next Steps:
Satisfying the needs of these unique consumer personas can be challenging without the right resources on your side. Ensure you partner with an industry-leader who understands your multitude of accountholders and their unique set of risks.
EZShield’s award-winning suite of identity protection products helps secure, monitor and restore consumers’ identities. Our partners in the financial services industry work directly with EZShield to build a comprehensive program designed to engage and empower accountholders. From secure online storage to advanced monitoring and world-class restoration delivered by U.S.-based certified Resolution Specialists.
For more information on EZShield Identity Crime Protection, schedule a demo today.