Online fraud is surging: Five facts you probably don't know

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Online fraud is surging as more people stay at home and online activity increases. Here are five things about online fraud you probably didn’t know.

With COVID-19 lockdowns, there have been “significant spikes in fraud attempts” compared to 2019, cybersecurity firm Arkose Labs said in its Fraud and Abuse Report covering the first half of this year.

The report noted some of the lesser-known facts about online fraud, including:

The most dangerous hour of the day to be online is at 5 a.m.: At this time there are high levels of “cross-border attacks from fraudsters operating across time zones,” the report said. And bad guys are using automated scripts “that can run through the night.” So, the peak hours when consumers are online don’t necessarily coincide with the peak activity of bad actors.

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File photo illustration -hands write on a computer keyboard on August 28, 2019 in Berlin, Germany. (Photo by Thomas Trutschel/Photothek via Getty Images)

In the first six months of 2020, the gaming industry experienced 65 attacks per second: With everyone staying at home, online gaming has spiked as gaming companies run “high-profile promotions to attract customers,” the report said. Fraudsters have noticed and will attempt to “blend in with good users,” according to the report. Gaming traffic rose 30 percent compared to the first quarter of 2020 and the most attacked “touchpoint” was logins, which rose 22 percent in attack volume compared to the previous quarter.

The Philippines and Russia are the top “attacking” nations for human malicious activity: The Philippines is the country with the highest human-driven attack volumes, along with Russia and Ukraine. “The amount of time and effort that a fraudster is willing to expend on an attack is driven by the monetization potential,” the report said.

Attacks by “sweatshops” on financial sites: Though banks and financial services are a challenge for fraudsters because the financial industry invests a lot in anti-fraud tech and security, financial institutions on the Arkose Labs network saw attack levels rising in the second quarter. “These attacks were primarily driven by human sweatshop activity and targeted application fraud,” the report said, referring to malicious human activity as opposed to bot attacks.

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Bots are rampant on social media: Social media sites saw a spike in bot-driven activity in April and May. Bad actors use bots – automated programs that perform repetitive computing tasks – in order to “scrape information, launch scams or disseminate malicious content,” the report said. Bots are also used to influence political and social discourse by “spreading information en masse and carrying out hashtag hijacking and trend-jacking.” The issue of bots will continue to come under scrutiny with the presidential election looming, the report said.