What Fraudsters Want This Christmas

December 9, 2015

We’re in the midst of another holiday season, which means holiday shopping and a whole slew of projections and data that accompany it. Both have mentioned the growth of a new shopping method: mobile devices.

In the past, holiday shopping meant people hit the malls to shop for their gifts with care, scouting out deals in storefront windows. Shopping in person, at an actual store, is becoming less and less common. Some are even postulating Cyber Monday will be the new Black Friday, as this year’s Monday sales helped lessen the hit retailers took on Friday.

This year, mobile shoppers are rapidly increasing their share of the numbers, with 41% of all sales on Cyber Monday from smartphones. The total amount of smartphone shopping during the biggest shopping weekend of the year increased 65% compared to the same period last year.

Increase in mobile sales on Black Friday through the years

While the holidays tend to bring joy and children dream about presents, retailers are bracing themselves. With a surge in shopping during the holiday season comes a surge in fraud. The months of November and December contain the 10 busiest shopping days. More people exchanging money through online, mobile, and brick-and-mortar avenues means more opportunity for fraudsters to weasel their way in. The recent adoption of EMV security chips in credit cards means fraudsters will be driven to mobile and online methods.


Some, like ACI Worldwide, are saying this year is special, but not in a good way: “When it comes to fraud, 2015 is likely among the riskiest season retailers have ever seen.”

This statement, coupled with the explosion of mobile shopping, can have retailers expecting the worst during the holiday season, as mobile fraud results in losses around 3x the cost of a product. Beyond money, fraud also results in lost trust and frustrated customers.

Fraud Protection this Holiday Season

This Christmas, fraudsters are looking for a spot at the dinner table. Don’t invite them by leaving vulnerabilities that make their jobs easier.

Both shoppers and retailers can take steps to protect themselves and keep mobile fraudsters at bay.



The holiday deals can be extremely tempting. Shoppers can take advantage of them and still enter the new year fraud-free.

A significant number of shoppers are worried about using a mobile device because of security concerns. This is beginning to change, though, as mobile devices become more ubiquitous. Shoppers can embrace the benefits of using a mobile device while still being careful to protect themselves. Here’s how:

  • Educate yourself on common types of mobile fraud so you know how fraudsters may try to access your money. Being prepared is the first line of defense. Read our post on “/most-common-types-of-mobile-fraudMost Common Types of Mobile Fraud” for more!
  • Be wary of deals that sound too good to be true. Unfortunately, one of these scams hit shoppers this year. Shoppers were approached with a mobile Amazon app that would give them early access to Black Friday deals. This app turned out to be fake, a ploy to lure shoppers into installing malware that hacks data stored on their phones.
  • Use multiple authentication methods to increase your mobile safety, including passwords and text message verification. Two-step authentication makes it harder for fraudsters to hack into an account. Also, keep an eye out for retailers that use more secure, behavioral authentication. If properly executed, these can help keep your mobile device safer than traditional methods. Read our post on the history of online authentication and new directions here.



Retailers have the ability to set the standard for deterring fraud. The holiday season represents the ultimate test of a major retailer’s fraud prevention program. It is the time weaknesses are most likely to be exposed, which can lead to disastrous losses.

The holiday season represents a huge opportunity for businesses. As one source says, it “can often make the difference between success or failure in the retail industry.”

Here are some steps retailers can take to help minimize losses this holiday season:

  • Strengthen fraud detection methods with behavioral methods that can detect fraud with less false positives (when a normal shopper is misidentified as a scammer). False positives can be a huge detriment, as many shoppers will not return after they are wrongly deemed a fraudster. For our discussion on fraud detection methods, see “Why are Businesses Struggling to Fight Mobile Fraud?
  • Strengthen authentication methods. Authentication determines whether a user accessing an account or making a purchase is the real owner of the account.
  • Balance friction and secure authentication methods. Holiday sales are extremely important for retailers, so it’s important not to drive shoppers away with high friction while still maintaining security. Shoppers are driven away by lengthy checkout processes, resulting in more abandoned carts for retailers and lost opportunity to make a profit. For more on the balance between friction and fraud, read “The 3 Fs of Mobile Payment.”


The holiday season is a time for shoppers to shop and retailers to reap the benefits. It shouldn’t be a time for both to fear the possibility of fraud.

If retailers focus on improving fraud prevention programs and adding new, more secure methods, the instance of fraud can decrease. Then, the holiday season can be a time for everyone to enjoy, even retailers!


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