Phone Fraud on the Rise: Report

Phone Fraud on the Rise: Report
Consumer complaints about phone fraud are on the rise, according to a new report from Pindrop Security. The report found that the volume of consumer complaints in the first half of 2012 has already matched overall complaint volume from 2012. Some 2.3 million consumer complaints of phone fraud were reported in the first six months of 2013, the same number as all complaints reported in 2012. Pindrop estimates that the average loss from phone fraud comes to $42,546 per affected financial account. The high average is due to fraudsters simply cleaning out an account once they have taken it over, says Pindrop's Matt Anthony. Phone fraudsters use a variety of social engineering attacks to gain control of financial accounts, with Anthony reporting that the average fraud is perpetrated over the course of five discrete phone calls. Most phone fraud is also tied to organized crime groups and a large percentage is conducted using voice over IP services. "VoIP is easier to spoof, and is cheap to do from anywhere in the world," Anthony says. The report found that a full third of phone fraud is conducted using VoIP and about half using mobile devices, leaving only 14 percent of frauds to be carried out using traditional landlines.