By Brady Harrison, Senior Data Analyst, Kount
We often hear stories of credit card fraud, and in my role as Senior Data Analyst at Kount, I work to prevent it. Yet, who are the people behind acts of credit card fraud – the type of fraud that generates chargebacks and costs businesses financial pain and stolen product?
Based on the record rise in unemployment claims across the country, many people are facing financial and social strain as a result of COVID-19 shutdowns.
The U.S. unemployment rate jumped to 14.7 percent in April 2020 as the Covid-19 crisis threw millions out of work. The number of unemployed persons rose by 15.9 million to 23.1 million, according to recent reports. In addition, weekly unemployment numbers are also still affected by a backlog of claims that overwhelmed many state systems over April and May.
Financial pressures combined with the fear of “what if I get sick?” generates a combination of pressure that is giving rise to alternative or supplementary income opportunities.
During the period of state-wide lockdowns, which are now beginning to lessen, many people were sheltering in their homes and finding they had lots of time on their hands. After getting caught up with binge-watchable series, attention shifted and many decided to learn new skills, some of which are less than legal.
In a recent article in Cybernews, their research discovered that many individuals are turning to cybercrime as a potential source of income. Visits to hacker websites and chat forums increased by up to 66% in March. And they say, “2020 might prove to be the year when the ranks of cybercriminals spike exponentially due to the economic downturns caused by the COVID-19 pandemic.”
It’s no surprise that criminal activity aligns with worsening economic conditions, given the financial pressure of making ends meet among layoffs, furloughs, and bankruptcies. Fraud looks like an ever more attractive option when main streets are closed or barely hanging on.