Key Takeaways:
- Forced verification and deepfake cases have been increasing at an alarming rate in the UK and continental Europe.
- Industries such as consulting, crypto services, e-commerce, and IT services have experienced varying degrees of fraud.
- Document fraud trends show that driver’s licenses are the most popular document for identity checks in the UK, while ID cards dominate in continental Europe.
Forced Verification and Deepfakes on the Rise: New Fraud Statistics Reveal Alarming Trends in the Business World
The world of digital fraud is witnessing a concerning surge in forced verification and deepfake cases, according to the latest statistics from Sumsub, a global verification platform. As businesses grapple with increasing fraud attempts, the need for robust security measures and full-cycle verification has become more critical than ever.
Forced Verification: A Growing Trend
Sumsub’s analysis of anonymized verification data collected from its clients reveals a significant rise in forced verification worldwide. In Germany alone, forced verification cases skyrocketed by an astounding 1500% compared to the previous year. What was once a mere 0.3% of all fraud cases in 2022 has now surged to 5% in Q1 of 2023.
The United Kingdom and Europe also experienced a noteworthy increase in deepfake cases. Proportions of deepfake-related fraud climbed from 1.2% to 5.9% in the UK, 1.5% to 7.6% in Germany, and 0.5% to 5% in Italy between 2022 and Q1 2023. Simultaneously, instances of printed forgeries, which accounted for a significant portion of fraud in the previous year, dropped to minimal levels in the last quarter.
Industries Impacted by Fraud
Sumsub’s internal statistics shed light on the industries most affected by digital fraud in the UK and continental Europe. Within Great Britain, the consulting industry witnessed a tripled proportion of fraud cases, while crypto services experienced a doubling of fraud rates in Q1 2023. Conversely, fraud figures in the fintech sector decreased from 3% to 1%.
The e-commerce industry, which has seen substantial growth in recent years, observed a 1.5-fold increase in fraud cases in 2022. In Q1 2023, IT service platforms showed relatively high fraud rates of 1.5%. Similarly, across continental Europe, the shared mobility industry bore the brunt of fraud, with Spain and France reporting 4% and 3.6% of fraud cases, respectively.
Document Fraud Trends
Sumsub’s global data analysis further delves into the types of documents used for online verification. In the UK and the US, driver’s licenses remain the most commonly used document for identity checks. In continental Europe, however, ID cards dominate the verification process. Interestingly, passport usage in the EU proves to be the least secure, with fraud levels reaching 5% in Spain and 3.3% in Germany. In the UK, ID cards were forged most frequently, accounting for 3.4% of cases.
Notably, the dynamics of fraud types have shifted between Q1 2022 and Q1 2023. Last year, the top three fraud types were liveness bypass, printed documents, and edited ID cards. However, in the most recent quarter, identity document forgery emerged as the primary fraud type, accounting for 40% of all fraud cases in the UK and Italy, and over 25% in Germany and Spain.
Identifying Fraudsters: Age, Gender, and Timing
Fraudsters come in various shapes and sizes, as Sumsub’s analysis reveals. In the
United States, the oldest fraudsters had an average age of 43 in Q1 2022, which decreased to around 40 in Q1 2023. In the UK, the average age of fraudsters was 32 in Q1 2022 and rose to 35 in Q1 2023.
Gender breakdowns present intriguing insights as well. In the UK, female fraudsters accounted for 34% of all cases in Q1 2022 but dropped to 21% in Q1 2023.
Regarding timing, fraud in the UK was most prevalent at 2 p.m. GMT in 2022. However, in Q1 2023, the peak shifted to 12 p.m., while the early morning hours witnessed the least amount of fraud, particularly between 4-5 a.m. GMT.
Pavel Goldman-Kalaydin, Head of AI & ML at Sumsub, expressed concern over the rising trend of forced verification and deepfakes. He emphasized the importance of continually updating deepfake detection technologies to protect businesses and users from potential risks.
As digital fraud continues to evolve, businesses must prioritize robust verification processes and stay one step ahead of fraudsters. Sumsub’s full-cycle verification platform offers a comprehensive solution to safeguard the entire user journey, ensuring compliance, reducing costs, and protecting businesses from financial fraud.
About Sumsub:
Sumsub is a full-cycle verification platform that provides end-to-end security throughout the user journey. With customizable KYC, KYB, transaction monitoring, and fraud prevention solutions, Sumsub enables businesses to streamline their verification processes, expand their customer base globally, meet compliance requirements, reduce costs, and protect their business from fraudulent activities.
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