[Editor’s Note: All this month we will be taking a look back at CNP Expo 2019. Merchants and service providers who attended praised the comprehensive education and networking available to them across the three days of the event. For our readers who were not able to join us, we want to provide a taste of what you missed, and we hope to see you in San Francisco next year. Over the next few weeks, we will provide highlights from each of the Expo’s three information-packed days]
On its first day, CNP Expo attendees got an advance look at one of the most eagerly anticipated fraud benchmarking reports released each year. For U.S. merchants in 2019, the True Cost of Fraud Study from LexisNexis Risk Solutions found that every $1 of fraud loss actually cost companies $3.13. That’s 6.5 percent higher than last year and the highest figure measured by LexisNexis in the 10 years the company has been producing the report. To account for all the costs a business incurs from a fraudulent transaction in addition to the direct loss of the stolen goods, the company uses a proprietary multiplier.
“The amount of time it takes you to research the fraud, any restocking fees and other various costs come into play every time you lose a transaction to fraud,” said Kim Sutherland, vice president of fraud and identity strategy at LexisNexis Risk Solutions.
While the report will be released widely later this year, LexisNexis shared preliminary results with attendees of a pre-conference session at the CNP Expo at the Marriott Marquis in San Francisco. A full slate of conference sessions ran all day Wednesday, May 22, and Thursday, May 23.
The study also noted a huge surge in fraud attempts and successful attacks. After posting moderate annual growth since 2013, the number of overall fraud attempts rose by 123 percent from 2018 to 2019. And, the number of those attempts that succeed grew by 84 percent. The average value of successful fraudulent transactions rose 34 percent from $184 to $248, according to LexisNexis.
Day 1 also featured two other pre-conference sessions. A CNP Boot Camp presented by Radial focused on the basics of fraud, chargebacks and conversion, while Innovis brought together a panel comprising retailers (Nordstrom), issuers (Synchrony) and card networks (Discover) to take a deep dive into synthetic ID fraud.