Financial Crime World

Botswana’s Financial Services Industry Hit Hard by Suspected Digital Fraud

A recent report by TransUnion has revealed that Botswana’s financial services industry was hit particularly hard by suspected digital fraud in 2023. The report found that the industry had the highest suspected digital fraud rate and year-over-year growth rate among industries analyzed.

High Suspected Digital Fraud Rate

The study found that a staggering 9.7% of all transactions where the consumer was in Botswana when transacting were flagged as suspected digital fraud, representing a whopping 196% increase from the previous year. Globally, financial services saw a 4.3% suspected digital fraud rate in 2023, with a 3% year-over-year growth rate.

Most Common Suspected Digital Fraud Attempts

The report suggests that fraudsters are increasingly using synthetic identities assembled from credentials gathered through data breaches to create new accounts, which they can control themselves. This is a shift from traditional tactics used by fraudsters to gain access to and compromise existing accounts.

  • 13.0% of suspected digital fraud attempts occurred during account login
  • Nearly one in seven newly created accounts globally were suspected to be created via digital fraud

The study found that the retail industry saw the highest percentage of digital account creation transactions suspected to be digital fraud globally, at 44.7%, followed by travel and leisure (36.0%) and video gaming (31.5%).

Botswana’s Industries Affected

In Botswana, the financial services industry was not the only one affected by suspected digital fraud. The report found that across industries in 2023, 3.0% of all transactions where the consumer was in Botswana were flagged as suspected digital fraud, representing an 85% year-over-year increase.

Insights from TransUnion’s CEO

Kabelo Ramaselwana, CEO of TransUnion Botswana, noted that this early-phase new account digital fraud may represent a paradigm shift among fraudsters globally, adding that “fraudsters are increasingly choosing to create new accounts that they can control themselves.”

Methodology

The study’s findings are based on proprietary insights from TransUnion’s global intelligence network and includes data from Botswana, Brazil, Canada, Chile, Colombia, the Dominican Republic, Hong Kong, India, Kenya, Mexico, Namibia, the Philippines, Puerto Rico, Rwanda, South Africa, Spain, the United Kingdom, the United States, and Zambia.