Blog

From the Cloud: Deep Insights into Wire Fraud Trends

Latest Data Shows Fraudsters Pushing More Lucrative Scams

March 15, 2023 by Nasdaq Verafin

Payment fraud is a challenge that is pervasive in the financial industry, and a threat to financial institutions of all sizes. As the talk of a liability shift for consumer-related payment fraud gains momentum within regulatory spheres, additional pressure is on the industry to respond.  

In our upcoming Cloud Insights: Wire Fraud Benchmarking Report for Q1 2023, we share attempted wire fraud trends and statistics observed from Verafin Cloud data from Q4 2020 to Q3 2022. This blog describes key highlights from our expert analysis — for more insights, watch our Archived Webinar and download a copy of the full Report

Trending Higher: Wire Fraud Attempts Continue to Rise 

Wire fraud attempts have reached their highest values across our network. In Q3 2022, the value of a typical attempt was $17.35K, up 75.3% compared to Q3 2021. 


Industry Risk as Wire Fraud Values Increase 

From Q3 2021 to Q3 2022, attempted wire fraud against businesses increased in terms of basis points by value and occurrence, with the median value per attempt rising from $26.0K to $35.2K. The Finance and Insurance industry saw 20% of all attempts by occurrence, while attempts against the Professional Services segment accounted for 31.6% of the total value.  


Consumer Wire Fraud a Concern 

The mean and median value of attempted wire fraud against individuals increased from Q3 2021 to Q3 2022, with the median rising from $8.0K to a new high of $13.1K, and the mean seeing a significant increase during this timeframe from $20.3K to $33.2K. This increase was largely driven by criminals increasingly focusing wire fraud attempts against the elderly (people aged 55 or older), who accounted for 73.5% of attempted occurrences and 74.7% of attempted wire fraud value. 


Seniors at the Greatest Risk 

In Q3 2022, people aged 55 or older saw a new high for mean value of attempts ($33.7K) and maintained a considerably high median value for attempts ($14.6K) compared to Q2 2022. Looking further into this group, people aged 65 to 75 saw the most wire fraud attempts by value (32.9%) and occurrence (30.5%). 


Top Destinations for Domestic Wire Fraud  

From Q3 2021 to Q3 2022, the typical value of a wire fraud attempt destined for a location within the United States was $16.4K, up 70.0% from Q3 2021 and to a new high since the start of reporting. In Q3 2022, the top destination states for attempted domestic wire fraud by occurrence and value were California, New York, Florida, and Texas. This should come as no surprise as these are higher population states which provides more opportunity for mule recruitment.  


International Wire Fraud Values Take a Jump 

From Q3 2021 to Q3 2022, the typical value of a wire fraud attempt destined for locations outside the United States was $20.0K, an increase of 78.7%. By occurrence, international wire fraud attempts were most frequently destined for Hong Kong, Mexico or China. By value, the top destinations for wire fraud attempts were Hong Kong, Mexico, and Turkey.  


Consortium Approach Continues to Provide Major Benefits 

As financial institutions face potential liability shifts for payment fraud, consortium data is crucial to effectively combat Authorized Push Payment (APP) fraud scenarios, including Business Email Compromise (BEC) and scams targeting consumers. Leveraging 420 million counterparties in the Cloud, Verafin’s Consortium Analytics provide insight into both the payer and payee for a complete picture of the risk. This unique approach significantly reduces false positive alerts — by an average of 40% — and allow you to decisively stop fraudulent payments and protect your customers from loss. 

With our growing number of customer partners, Verafin continually enhances its ability to identify potential mule accounts and increase the performance of our payment fraud solutions, allowing for more effective fraud prevention before losses are incurred. For more information on our consortium approach to combating payment fraud, download our Product Brochure.  

Subscribe for curated expert perspectives and industry insights, sent directly to you.
Nasdaq Verafin provides cloud-based Financial Crime Management Technology solutions for Fraud Detection, AML/CFT Compliance, High-Risk Customer Management, Sanctions Screening and Management, and Information Sharing. More than 2,500 financial institutions globally, representing more than $8T in collective assets, use Nasdaq Verafin to prevent fraud and strengthen AML/CFT efforts. Leveraging our unique consortium data approach in targeted analytics with artificial intelligence and machine learning, Nasdaq Verafin significantly reduces false positive alerts and delivers context-rich insights to fight financial crime more efficiently and effectively. To learn how Nasdaq Verafin can help your institution fight fraud and money laundering, call 1-877-368-9986.