UK becoming a global hotspot for online fraud

The UK is fast becoming a global hotspot for online fraud, which is having a devastating impact on both businesses and the economy according to research from fraud prevention platform Ravelin.

The analysis shows online fraud is increasing globally but has grown more in the UK in the last 12 months than any of the ten countries surveyed, including France, Germany, Italy, America, Brazil, Australia, and Mexico.

One in four of the businesses polled said that they lose over $15m (£12m) to fraud every year.

The explosion in online fraud threatens to hamper economic growth with over half of respondents (51.8%) stating that fraud is stifling the growth of their company, leading to wider knock-on impacts.

In the UK  84% of merchants say fraud has increased, followed by Australia (83.4%) and Spain (81.3%). Globally, fraud has increased for 74.8% of businesses in the past 12 months.

Companies’ growth is stifled by fraud across the board (51.8%) and 19.9% say stock price is damaged. Well over a third of businesses (40.4%) say their brand image is affected. In the UK, 61.1% of businesses have been mentioned in the press or on social media in relation to fraud. In Australia, 83.3% have suffered this kind of negative publicity.

Growth, revenue, and reputation are far from the only things impacted by the rise in fraud. Staff morale can be affected, with nearly a quarter (24.3%) saying this is an issue. Over a third (36.9%) say it hurts customer loyalty while 37.1% of merchants say fraud has driven poor customer satisfaction and churn.

Ravelin CEO Martin Sweeney said “Online fraud shows no signs of slowing down. The speed of adoption of new tactics and technologies such as AI by fraudsters, both amateur and professional, is happening at breakneck speed. The democratization of fraud affects us all.

“Many merchants are deeply concerned about the impact on revenue, growth and reputation so it’s crucial to be fully up to speed with the idiosyncrasies and trends of this fast-changing fraud landscape.

“Across fraud leaders in our four key sectors of the market, machine learning was once again recognised as integral to fraud fighting efficiency. Machine learning models and features offer flexibility and scalability in the face of transforming threats.”