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Fraud losses cut
In a year that presented fraudsters with new opportunities to exploit consumers, UK financial institutions continued to lead the charge across Europe in thwarting the criminals according to new data from FICO’s updated European Fraud Map (www.fico.com/europeanfraud) which saw the UK achieving the greatest fall in card fraud monetary losses, dropping 7% and £46 million year-on-year. However, other nations among the 18 European countries studied did not fare as well.
“Fraudsters are constantly scanning for access to poorly protected accounts and opportunities to manipulate transactions and this is what made 2020 such a challenge. Fraud teams would have faced wave after wave of sophisticated COVID and Brexit scams, which makes the success of UK financial institutions – protecting Brits’ finances – even more impressive,” says Matt Cox, Vice President for Financial Services in EMEA at FICO.
“Despite this ever-changing set of priorities and demands, several countries across Europe significantly improved their fraud prevention performance, contributing to a second consecutive year of reduction in the losses experienced through fraud. This is crucial for consumers who want the peace of mind that the institutions in which they trust their finances are doing all they can to stop the fraudsters.”
While Europe enjoyed a sizable £54 million drop in fraud loss for 2020, this was primarily driven by two countries, accounting for a reduction of £78 million between them. The United Kingdom achieved a £46 million reduction (7% year-on-year); whilst Denmark recorded a €21 million decrease (48%).
“After achieving the largest single reduction of any European country in 2019, the banks of the UK have repeated this with the best net reductions of the 18 countries in this report for the second year running,” notes Toby Carlin, a senior director of fraud consulting at FICO. “In an incredibly challenging year, only five of the 18 countries analysed by FICO achieved a reduction in card fraud.”
Unfortunately, fraud losses continued their increases in France (€6 million higher than 2019), Poland (€4 million higher) and Germany (€3 million higher). Large-scale phishing and smishing efforts designed to introduce a scam which ultimately ends in fraudulent Card Not Present (CNP) transactions saw Norway’s fraud losses increase from €8 million in 2019 to €22 million in 2020, a rise of 172%, the largest rise of all the countries studied.
“Whilst it is incredibly positive for so many countries to have made gains through such a challenging period, with Turkey, Spain and the Czech Republic all showing a relatively flat trend through 2020, more needs to be done across the other European states to drive a truly collaborative reduction in all areas,” concluded Cox.
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