Follow the money is a phrase we’re all familiar with. Unfortunately, it also happens to be a favorite mantra for fraudsters, too.

As more and more merchants offer mobile payment options to their customers, cyber criminals are quickly moving into the mobile channel. In the Digital Transactions article, “Mobile-payments fraud starts to take its toll,” a recent study by Javelin Strategy & Research found that fraud losses from mobile payments as a percentage of total revenue were 1.13% compared to the 0.83% for online-only merchants and 0.86% for multi-channel merchants.

This trend doesn’t surprise Jim Rice, director of market planning for retail and e-commerce marketing at LexisNexis Risk Solutions. While the mobile channel represents a new way for businesses to connect with their customers, it’s also another opportunity where fraudsters will try to make a dishonest buck. (more…)

Along with the enormous success of mobile phone sales, wireless carriers and resellers have to contend with a variety of issues around theft and fraud. Working closely with several carriers and resellers, we’ve seen four primary fraud threats that financially impact carrier business. They include:

1. Account creation / application fraud – In this case, a fraudster uses a stolen identity to apply for an account online to order phones and services.  After initiating a shipping scheme to obtain the goods, the fraudster runs up the phone bill until the carrier or identity theft victim uncovers the charges.Much like credit issuers, carriers perform comprehensive identity and financial background checks on applicants, however, the checks are on the identity theft victim.  By adding a device check at the front of the process (which looks at the computer or Internet-enabled device being used), carriers can quickly identify suspicious activity such as when the same computer initiates multiple applications under various identities, or if the computer being used has been involved in previous fraudulent activity. (more…)