Call center fraud loss is having a significant effect on enterprises. According to Pindrop® Labs, the average call center is losing $0.58 to fraud for every incoming call. That means, across the U.S., companies are losing $14 billion to fraud attacks annually.
Things are not improving any time soon. Pindrop® Labs has been monitoring call center fraud rates over the past seven years, and reports that in the past year, attacks have increased 113%. This sharp rise in attacks indicates that fraudsters are moving from other channels, including physical and online, to the phone channel because it is lacking in protection.
Many enterprises try to secure their call centers using legacy authentication solutions, such as knowledge based authentication (KBA) questions, caller ID, or ANI verification. These solutions are ineffective at stopping fraudsters because they are based on a single factor, and can easily be avoided or fooled. Yet, call centers are spending $0.33 per call on these outdated methods, adding up to $8 billion spent every year in U.S. call centers.
All of these legacy authentication techniques have created an additional problem for enterprise call centers: poor customer experience. Knowledge based authentication questions are frustrating for legitimate customers, because they add time and friction to an interaction. Worse, many legitimate callers are unable to authenticate using KBA because they have forgotten or do not know the answer. In fact, a recent Gartner report detailed that “an average of 15% to 30% of customers fail identity proofing challenges based on PII data and life history questions, while up to 60% of criminals pass.”
To read more about the impact of phone fraud on call centers in the U.S. and around the world, download the 2017 Call Center Fraud Report from Pindrop® Labs.