Global new account fraud rates fell by 23 percent in 2020, in UK climbed 28 percent

A Jumio research has found that while global new account fraud rates fell by 23% in 2020, but fraud rates in the UK climbed 28%.

Jumio’s 2020 Holiday Fraud Report also found that the catch rate for selfie fraud was almost five times greater than for ID fraud, highlighting the growing importance of capturing a selfie during onboarding to deter new account fraud

At the same time, selfie-based fraud rates were nearly five times higher than ID-based fraud. This illustrates the growing number of stolen ID documents available on the dark web for purchase and, more importantly, the growing need to determine if an ID is authentic and belongs to the user.

The fourth edition of Jumio’s Holiday New Account Fraud Report examines fraudulent attempts to open a new account using a manipulated government-issued ID and a corroborating selfie. Selfie-based fraud describes fraudulent attempts to use a picture or video (e.g. deepfake) instead of a genuine selfie to corroborate a digital identity. The fraud rate associated with the selfie averaged 4.92% in the UK in 2020, compared to 1.03% for ID-only verification.

Key findings include:

• fraud rates in the UK, based on the ID document, have almost doubled from 2017 levels, and fraud levels in November were a full one-third higher than fraud levels from January to October in 2020;
• compared to other major European countries, the UK had the highest fraud levels, second only to Spain which experienced a 25% increase in ID-based fraud in 2020 (over 2019 levels);
• by virtue of requiring an ID and a selfie as part of the identity proofing process, Jumio has seen 80% less fraud compared to customers who only required a government-issued ID. Moreover, this finding demonstrates the chilling effect that the selfie requirement has on would-be fraudsters who abandon the process before taking the selfie;
• fraud rates differ significantly by implementation channel and are more than twice the level for web and API-based implementations compared to SDK (mobile apps) implementations;
• the online gaming and cryptocurrency verticals had the highest levels of new account fraud, suggesting that they remain ripe targets in the UK for money laundering and other forms of financial crime.

The report is based on the analysis of tens of millions of transactions from a variety of industries and geographies around the globe. It targets the period of January through October each year and the month of November to cover the holiday shopping period.