Account takeover fraud (ATO) is definitely not the new kid on the block. Establishments whose business model is centered around financial transactions, such as online retailers or banks, have been dealing with it for over a decade.
Unfortunately, this doesn’t mean that its appeal has died down over the years. In fact, account takeover fraud is more popular than ever. Recent account takeover statistics have shown an increase of nearly 300% since 2019 in ATO cases that have cost companies and consumers alike a whopping $16.9 billion in damages.
In the following lines, I will take you through the basics of account takeover fraud prevention. So, if you want to know not only how ATO works, but also how you can protect your business from it, keep on reading.
What is Account Takeover Fraud?
Account Takeover Definition
To define account takeover fraud, it is essential to first discuss the concept of identity theft. According to Investopedia,
Identity theft is the crime of obtaining the personal or financial information of another person to use their identity to commit fraud, such as making unauthorized transactions or purchases. Identity theft is committed in many different ways and the end result is that victims are typically left with damage to their credit, finances, and reputation.
In the case of an account takeover, cybercriminals gain unlawful access to the financial or e-commerce login credentials of a user, generally through means of a bot attack. This results in one or multiple fraudulent transactions being carried ou ..
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