Retail is now the number one target for cyberattacks. Because retailers hold large volumes of highly distributed personal information, including credit card data, these organizations are attractive environments for fraudsters to breach. In 2015, $60 billion was lost to retailers in the United States due to fraudulent activity.
The phone channel is the weakest link in information security. Sixty-one percent of fraud can be traced back to the call center. This vulnerability enables fraud in other channels, such as debit card, credit card, and check order takeover — online fraud that occurs quickly and easily as soon as fraudsters convince call center agents to reset a victim’s credentials through social engineering.
Call center fraud in the retail space is an urgent problem.
-One out of every 1000 calls into retail call centers is fraud-related.
-One out of every 300 calls related to “fencible” retail products, which are easily sold on the black market, is a fraud-related call.
-Fraud loss for retailers averages $3.4 million annually.
Fraud loss is mostly due to card-not-present (CNP) fraud, which has increased since the US transition to EMV technology. Fraudsters place orders using stolen credit card credentials, not only costing the retailer the price of the stolen merchandise, but also raising operational costs and increasing chargeback fees. According to Aite Group, an independent research firm, 72% of executives expect call center fraud loss to continue to grow, with $4 billion in counterfeit card fraud moving into the phone channel.
MRC Vegas is the largest global event focused on payments, fraud, cybersecurity and risk for connected commerce at the intersection of mobile, retail, marketing services, data and technology with more than 1500 attendees, including over 450 companies from over 30 countries. This year, Shawn Hall, Director of Fraud Strategy and Operations, will be presenting on the data breach butterfly effect that occurs across physical, online, and phone channels.