Onfido’s has released its 2020 Identity Fraud Report, finding yet more evidence of the increased amount of fraudulent activity since the onset of COVID-19. The company indicated that the rate for identity document fraud is up 41 percent over 2019. Much of that can be attributed to the pandemic, since the fraud rates were stable with 2019 levels for the first three months of the year.
According to the report, fraudulent activity was highest in July and August, although Onfido believes that there will be a second peak in November and December as people do their holiday shopping in the midst of a second lockdown. The report itself was put together with input from INTERPOL, and is based on Onfido data gathered between October 2019 and October 2020.
That data spoke to some dramatic changes in fraudsters’ behavior. In its 2019 report, Onfido noted that most fraudsters approached the job like professionals, insofar as they were most active from 9-to-5 and often took the weekends off. 2020, by contrast, was a year for amateurs, with the proportion of unsophisticated fraud growing from 57 to 70 percent while the proportion of sophisticated attacks remained steadily below one percent. Fraud also became a 24/7 activity, with rates being consistent across all seven days of the week.
Onfido suggested that those changes reflect the economic pressures of the pandemic, as well as the new digital work environment. People who have lost income may be turning amateur fraud into a side hustle to make ends meet, while the professionals are working extra hours to take advantage of the higher volume of digital traffic.
2020 also saw the increased use of masks, deepfakes, and replay attacks to beat selfie and video authentication systems. Meanwhile, fraud became more difficult to spot as consumers changed their spending habits and started buying more goods online.
“COVID-19 has catalyzed massive growth in identity fraud attempts, with industries like financial services disproportionately affected,” said Onfido Head of Global Document Fraud Michael Van Gestel. “Baking in more sophisticated identity verification methods, such as document and biometric authentication, will ensure that businesses can significantly lower the risk of fraud to their organization and customers.”
Onfido has experienced a surging demand for its biometric onboarding technology during the pandemic. The company’s sales are up 174 percent in the APAC region, and 237 percent in the United States.
December 8, 2020 – by Eric Weiss