A new study conducted Trust pair It was stated that payment fraud attempts on US businesses grew by 71% in 2023.
The study also reported that 96% of all US-based businesses were targeted by at least one fraud attempt in 2023, while 90% of these businesses fell victim to at least one successful fraud attack. The special research was conducted by Trustpair on more than 260 senior finance and treasury officials, and showed a rise in all types of fraudulent activity, from hacking and deepfakes to voice cloning and sophisticated phishing schemes.
More report findings
The company's report, “Fraud in the Internet Age: Fraud Trends and Insights for 2024,” shows that fraudsters are becoming more sophisticated in their tactics targeting U.S. businesses and are expanding their reach to consider attacking new targets, while finding their way into new channels to infiltrate organizations. Trustpair CEO states that there is a growing need to automate bank account validations and embed them in daily operations, with seller payment fraud on the rise.
Fraudsters mainly use text messages (50%), fake websites (48%), social media (37%), hacking (31%), scams (31%), and deepfakes (11%) to target organizations, which Personalizing companies means fraud teams must remain vigilant and deploy the latest fraud detection and prevention technologies to deter attacks.
According to the survey, 36% of companies claim that the average financial loss resulting from a successful fraudulent attack exceeds one million US dollars, while 25% of them report a financial loss of more than 5 million US dollars.
However, engaging with fraudsters not only cuts off funds from companies, it also sets a dangerous precedent and can significantly impact other organizations' trust in the targeted organization. In fact, 75% of CEOs and C-level treasury leaders said they would stop doing business with an organization that has been the victim of payment fraud. A company that deals with successful fraud attacks will also lose the trust of its customers (51%), investors (50%), and suppliers and vendors (45%).
There is an urgent need to invest in advanced fraud detection technology
The study indicates that 67% of US companies expect payment fraud to rise further in 2024, but most are not prepared to confront attacks, with only 16% claiming that they regularly clean and monitor their vendor database. Furthermore, only 28% verify information about the companies they work with even though scammers are more likely to impersonate trusted sellers or create fake sellers and fake bank transfers.
The good news is that companies, regardless of size, are now starting to realize the value of automation when successfully combating fraud. 34% of all businesses say they use automated account validation tools to verify sellers. On the other hand, 38% of organizations still rely on manual account verification processes, which can further complicate and slow down the fraud prevention process.
Headquartered in France, Trustpair is a successful payment fraud prevention platform for large companies around the world. Its focus is to help finance teams secure the entire P2P process by automating account validation. Back in October 2022, the fintech received €20 million in funding to focus on its US expansion in R&D. To date, Trustpair has helped more than 250 companies around the world efficiently deter fraud.