Skip to main content

Online shopping fraud up—particularly in two categories

E-commerce fraud is on the rise, but some categories — and states — are taking a particularly bad hit.

Total online shopping fraud increased 30% in 2017, according to a report from Experian Information Systems. The rise was most dramatic in shipping, where it rose to 37% in 2017 over the previous year, and billing, where the rate increased 34%. (Shipping fraud occurs when a criminal uses their address for the delivery of stolen goods purchased online. Billing fraud occurs when the victim’s address is tied to the payment account used to purchase the stolen goods.)

From a regional perspective, the Western U.S. saw a nearly 60% increase in attack rates for shipping fraud. The North Central region saw a 50% increase in billing fraud.

Overall the data showed that 50% of total online fraud attacks were from Delaware, Oregon, Florida, New York and California. Delaware and Oregon are the riskiest states for both billing and shipping fraud for the second year in a row and continue to see a significant increase in shipping attack rates, with Delaware increasing over 300%, and Oregon just under 300%.

In more findings:

• The top five riskiest states for shipping fraud were Delaware, Oregon, Florida, New York and California. Nearly half of all shipping fraud attacks happened in these states as they made up 27.6% of all e-commerce transactions from a shipping perspective.

• The top five riskiest states for billing fraud were Delaware, Oregon, Washington, D.C., Florida and Georgia. The top 5 states for billing fraud made up about 18% of overall fraud attacks.

• The top riskiest ZIP codes in America for online fraud were all near international airports and seaports because these are ideal locations for reshipping stolen merchandise quicker before victims or card issuers can take action. Beaverton, Oregon, is home to the ZIP code that has the highest shipping attack rates among all eligible zip codes in the U.S., with billing fraud rates at 21.8% and shipping fraud rates at 27.4%.

• In 2017 among fraudulent transactions, 53% of those took place through an internet browser while 29% happened on a mobile device.

• $855 was the average amount lost per ZIP code for online shopping fraud in 2017.

• Credit card fraud was the most common form of identity theft in 2017, according to the FTC. In 2017 among the fraudulent transactions, 92% of those used a credit card, while 7% happened through direct billing, third-party transfers or prepaid gift cards.

For the full report, click here.
This ad will auto-close in 10 seconds