As our lives become increasingly digital, threat actors gain even more avenues of attack. With the average person spending about 400 minutes online, many scammers enjoy a heyday. Old impersonation scams continue to deceive people every day, as con artists and hackers are armed with advanced technologies and sophisticated social engineering tactics.
According to the Federal Trade Commission, financial fraud increased by over 30% from 2021 to 2022, with total losses surpassing $8.8 billion. This ever-evolving threat will continue to pose a real danger to consumers and companies until security teams can adapt to combat it.
What is financial fraud?
Financial fraud is any crime where someone uses illegal or deceptive practices to steal money or otherwise compromise a person or entity’s financial assets or standing.
Typically, most types of fraud involve a scam where the perpetrator uses stolen credentials, documents or authentication methods to deceive authorities and manipulate technology systems for illicit gain.
9 common types of financial fraud
Here are nine of the most common types of financial fraud in 2023:
1. Identity Theft
Identity theft occurs when a criminal steals someone’s personally identifiable information (PII), such as their Social Security number (SSN), name, address or date of birth. With this sensitive data, thieves can impersonate victims to take over online accounts, secure fraudulent loans and commit bank scams.
2. Tax Fraud
Tax fraud is the illegal practice of evading tax obligations. Companies might underreport their income, falsify expenses or otherwise “cook their ..
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