Emerging Trends in Transaction Fraud for 2024: Safeguarding Your Business and Customers

Transaction fraud is a serious threat in the digital age, with fraudsters constantly evolving their tactics to exploit vulnerabilities in the system. As we enter into a new year, it is crucial for businesses and consumers to stay ahead of the curve by being aware of the latest trends in transaction fraud.

One of the growing trends in transaction fraud is A2A/P2P fraud, where fraudsters target direct payment methods such as account-to-account and person-to-person payments. With the rise of online shopping and bookings, fraudsters are finding ways to exploit these platforms to steal account and user information for their own gain. Businesses that frequently use A2A payments must remain vigilant to protect their reputations and their customers from falling victim to fraudulent schemes.

Online travel bookings are also a popular target for fraudsters, with counterfeit websites and deceptive advertisements luring travelers with attractive deals on flights and accommodations. It is essential for travelers to be cautious when booking online and to only use reputable sources to avoid falling prey to fraudulent schemes that could result in lost money and ruined travel plans.

Another concerning trend in transaction fraud is brushing scams, where fraudsters send unordered merchandise to individuals in an attempt to fake legitimate sales and garner positive reviews. These scams can deceive unsuspecting shoppers into making more expensive purchases, only to realize they have been tricked by fraudulent sellers who have vanished with their money.

Collusion for transaction fraud is a sophisticated scheme where merchants form alliances with fraudsters to defraud payment acquirers. This form of fraud can have dire consequences for businesses and customers, as fraudsters and merchants work together to deceive consumers and evade detection by authorities.

Pig butchering is a particularly insidious form of transaction fraud, where fraudsters use social engineering tactics to trick victims into making substantial investments with promises of high returns. Victims are lured in with impressive interest payments, only to have the fraudster disappear with their money when they attempt to withdraw their funds.

Card testing is another common form of fraud that happens in multiples, where fraudsters use stolen credit card information to make multiple small transactions to test the validity of the card before making a larger purchase. This tactic can go unnoticed by overwhelmed merchants during busy seasons, highlighting the importance of vigilance and early detection in combatting transaction fraud.

In this ever-shifting landscape of transaction fraud, the power of AI for fraud prevention has become essential. AI models trained with historical global intelligence can predict and prevent fraud attempts earlier in the payment process, significantly improving fraud detection for businesses and consumers. Mastercard’s suite of AI fraud decisioning technologies is leading the way in transaction fraud prevention, with over 15 years of experience in identifying and preventing fraud in real-time.

As we move forward into the new year, it is crucial for businesses and consumers to remain vigilant and informed about the latest trends in transaction fraud. By harnessing the power of AI and staying one step ahead of fraudsters, we can effectively combat transaction fraud and protect both businesses and consumers from falling victim to fraudulent schemes.