While the retail experience is becoming increasingly omnichannel, retailers are still neglecting the phone channel, the weakest link in security, as a common point of access for customers. Despite the intent to administer positive customer experiences, call center agents often fall victim to the methods that enable fraud attacks.
Top 5 Threats
- 61% of fraud can be traced back to the call center. The root cause of fraud loss, the call center, is often misdiagnosed by retailers, enabling fraud in other channels, such as debit card, credit card, and check order takeover — online fraud that occurs as soon as credentials are reset by call center agents.
- Retailers in the United States lost $60 billion to fraud in 2015 mostly due to increased chargeback fees coming from card-not-present (CNP) transactions. 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.
- One out of every 1000 calls into retail call centers is fraud-related. Retail is now the #1 target of cyberattacks, surpassing financial institutions, where one out of every 2,650 calls is fraud-related.
- One out of every 300 calls related to “fencible” retail products is a fraud-related call. Fraudsters especially like to target “fencible goods,” expensive, popular items easily resold on the black market.
- Fraud loss for retailers averages $3.4 million annually. Instead of using social engineering to gain access to money in an account, fraudsters target retailers by placing orders for material goods over the phone.
These fraud attacks increase operational costs, decrease customer satisfaction, and jeopardize brand reputation as customer data is repeatedly lost to fraud. Retailers’ existing security systems are not robust or secure enough to handle the increasing volume of data filtering across web-enabled devices and processes. A digitally-influenced retail experience may enable brands to conduct business from a variety of access points, but it is also putting their enterprises under siege.
On April 19, 1:00pm-2:00pm, Pindrop’s Director of Fraud Prevention and Strategy, Shawn Hall, will offer his insight into the ways that fraudsters surpass security methods and infiltrate organizations through call centers.