Industry executives and experts share their predictions for 2024.  Read them in this 16th annual VMblog.com series exclusive.

The Year of Fraud Prevention

By Mary Ann Miller, fraud & cybercrime executive advisor and VP of client experience at Prove

In light of increasing incidents of identity fraud, the public and private sectors must rethink how they establish identity confidence. Identity-related attacks continue becoming more innovative, and fraudsters are increasingly brazen. Going into 2024, identity-proofing strategies must be at the top priority for every organization, and consumers also need to become more aware of the evolving threats.

Prioritizing online safety

Organizations and individuals alike must adopt better cyber hygiene practices online. Staying safe online means prioritizing digital identity. A recent survey found that more than half (51 percent) of consumers have been a victim of identity fraud or know someone who has, and society as a whole must take the necessary steps to ensure better security of personal information.

Password security is one critical element that consumers should prioritize. The same survey found that almost half of respondents (48 percent) said they save their passwords on their devices, either using an in-browser password manager or saving a note on their mobile device or desktop. Moreover, only 30 percent of consumers believe their passwords are safe, implying a general lack of confidence in password security.

Consumers should take advantage of all secure digital identity services offered by the brands they work with. This includes accounts from banking and credit cards, healthcare, mobile services, and online shopping. They should also ensure that they use complex passwords that differ for each brand they work with and that they're saved in a safe place like a password management system.

It's also critical to call attention to AI-based fraud on the rise, such as social engineering, password hacking, deepfakes, and voice cloning. Enabling fraudsters to launch more sophisticated scams poses a significant threat to consumers, and we can expect these tactics to enhance further in 2024.

Organizations step up their fraud prevention game

According to the Financial Crimes Enforcement Network's (FinCEN) recent Identity Project, suspicious activity reports (SARs) are rising. The research found that out of 3.8 million SAR submissions in 2021, an astounding 1.6 million (42%) were related to fraud, including identity theft and synthetic identity fraud - amounting to $212 billion in all identity fraud-related SARs.

We can expect SARs to continue rising in 2024, which should sound the alarm for both organizations and consumers. Organizations like banks and credit card companies can't afford to miss out on the technology that can best determine a user's identity.

They should leverage technology that examines trusted phone numbers to certify identity consistently. With data breaches and attacks constantly evolving, it's no longer enough only to confirm personally identifiable information. Investing in the technologies and processes that support more thorough and accurate investigations into proving one's identity is critical.

A greater emphasis on digital identity technologies

With fraud becoming increasingly sophisticated, effective protection requires a proactive approach. Organizations will emphasize applying identity checks and other attack monitoring as critical lines of defense to better identify attacks based on specific behaviors. Businesses like financial institutions must be prepared to fight against identity fraud, phishing attacks, credential stuffing, account takeover, and other fraud scams expected to increase in 2024.

Attack rate monitoring, for example, is among the most critical defense mechanisms for security teams, representing the frequency and intensity of attempted fraudulent activities. It's also a crucial tool for processes like account opening, a critical component of an organization's cyber framework. Organizations must establish that these processes are being attacked like web application firewalls with unprecedented velocity.

By tracking the attack rate meticulously, organizations gain real-time insights into the malicious intent of cybercriminals. Doing so enables proactive detection and analysis of potential threats, allowing swift and informed measures to be deployed.

As 2023 winds down, remaining proactive regarding the evolving fraud landscape is of the essence. Early fraud detection is critical; the earlier an issue is discovered, the faster it can be eliminated. As organizations continue their 2024 security planning, consumers should also do the same by doing their due diligence to educate themselves on rising fraud, best practices for security hygiene, and doing their part in keeping their family and friends informed.

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ABOUT THE AUTHOR

Mary Ann Miller is the Fraud & Cybercrime Executive Advisor and VP of Client Experience at Prove. Mary Ann is a well-respected expert in the fraud and identity space who has been quoted by BBC News, NPR, American Banker, USA Today, and others. Mary Ann was most recently Head of Fraud Strategy at Varo Bank, where she led the fraud strategy process for transitioning the fintech to a nationally chartered challenger bank. Prior to that, Mary Ann's held directorships and executive roles at well-known organizations such as USAA, PayPal, Lloyd's Banking Group, and other technology firms. She has also served on the US Federal Reserve Secure Payments Task Force and is a current member of the Federal Reserve's Scams Definition and Classification Work Group.