Jumio is breaking with the conventional wisdom in its fourth annual Holiday New Account Fraud Report. The company found that new account fraud rates for its customers went down 23.2 percent between 2019 and 2020, which is at odds with other reports that have suggested that fraud has increased during the COVID-19 pandemic.
Jumio nevertheless stands behind those results, noting that fraud prevention solutions that require an identity document and a selfie are much more effective than solutions that rely on an identity document alone. In that regard, Jumio indicated that it faced 80 percent less fraud than customers who only looked at an ID during the onboarding process.
However, cybercriminals are trying to get around those defenses. Fraudsters were more likely to attempt to spoof the selfie than they were to attack the document alone, with the fraud rates associated with each sitting at 7.15 percent and 1.41 percent, respectively.
The report is based on a comprehensive analysis of tens of millions of transactions between January and November, and specifically examines new account fraud that involves a spoofed selfie and/or a false or manipulated government ID. It found that fraudsters were more likely to commit fraud with passports and ID cards than with driver’s licenses, and that fraud rates are lower when identity verification is embedded within the SDK instead of being delivered through the web or an API that allows users to upload their own photos.
Jumio also reported lower fraud rates in the financial and gaming industries, which are usually popular (and lucrative) targets for cybercriminals.
“This year’s Holiday Fraud Report unearths a number of interesting global fraud trends that enterprises should consider as they architect the new account journey,” said Jumio Chief Product Officer Philipp Pointner. “By including both ID verification and identity verification with live selfies and liveness detection during the account onboarding process, organizations can more effectively deter fraudsters and better protect their ecosystems.”
The 2020 report reverses the trends seen in previous iterations of Jumio’s New Account Fraud report. In 2019, for example, new account fraud was up 27.8 percent over 2018.
In June, Jumio started fact-checking the information on driver’s licenses to make it easier to spot synthetic identities at onboarding.
December 15, 2020 – by Eric Weiss