by Lacey Pfalz
Last updated: 8:00 AM ET, Thu March 21, 2024
Travel and leisure is one of the top three global industries seeing the highest rate of suspected fraud in 2023, according to the TransUnion 2024 State of Omnichannel Fraud Report.
According to the report, around one in seven new accounts is expected to be fraudulent, with 13.5 percent of transactions associated with online account creation suspected to be fraudulent.
While retail was the highest industry seeing these fraudulent charges at 44.7 percent of suspected fraud attempts, travel and leisure came in at 36 percent, with video gaming following behind at 31.5 percent.
Yet the travel and leisure industry is not the highest-growing for fraud attempts. While fraud attempts in video gaming have risen 40 percent year-over-year, the travel industry has seen an 8 percent increase, with a 2.3 percent global suspected fraud attempt. In the U.S., the fraud attempt rate increased 9 percent from 2022 and the suspected fraud attempt rate 1.6 percent.
“This early phase new account fraud may represent a paradigm shift of sorts among fraudsters,” said Steve Yin, senior vice president and global head of fraud solutions at TransUnion. “In lieu of using traditional tactics to gain access to and ultimately compromise existing accounts, they are increasingly choosing to create new accounts that they can control themselves. These fraudsters leverage synthetic identities assembled in large part through the use of credentials gathered as a result of one or multiple data breaches.”
So, while fraudsters often target other industries at a higher rate than the travel industry, fraud in the travel industry is still going on, as are big data breaches, which can compromise personal information.
From 2020 to 2023, the number of data breaches in the U.S. rose 157 percent and 15 percent year-over-year to a historic high. The risk of data breachers actually stealing personal information also rose 11 percent from 2022, to 4.1 percent in 2023, another historic high.
In 2023, two large hotel companies fell victim to cyberattacks: MGM Resorts International and Caesars Entertainment. Just two months after the first attacks, the Allied Pilots Association, which is the union for American Airlines pilots, warned that personal information on some of its 15,000 members may have been exposed following its own cyberattack.
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