• by Tobi Elkin  @tobielkin, May 25, 2017

A new study by fraud detection company Fraudlogix finds that a majority of ad fraud is concentrated in a small percentage of sources within the real-time bidding (RTB) programmatic market.

Fraudlogix, which monitors ad traffic for sell-side companies, found that 68.2% of fake impressions came from 3.2% of publishers.

The findings reveal that high fraud percentages don’t represent the industry as a whole and that ad fraud isn’t evenly distributed. And sources that generated the highest percentage of fraudulent impressions contributed a disproportionately high number of impressions to the RTB market.

The study analyzed 1.3 billion impressions from more than 59,000 sources over a 30-day period.  Sites with more than 90% fraudulent impressions accounted for just 0.9% of publishers but contributed 10.9% of the market’s impressions.

Fraudlogix said the finding represents how detrimental fraudulent publishers can be to market quality as sites generating fake impressions can quickly outpace sites sending real traffic.

Overall, the study found 18.8% of impressions to be fraudulent. An impression was considered fraudulent (or fake) if a combination of digital and behavior characteristics synonymous with ad traffic generated through fraudulent means such as bots, scripts, hijacked devices, and click farms was detected.

Fraudlogix CEO Hagai Shechter said: “Getting to the root of ad fraud problem means looking at where fake impressions are originating – and they’re coming from a very small percentage of publishers who are flooding the market with fake impressions.”

Shechter said some publishers set up ghost sites with the sole purpose of monetizing with fake traffic, while others are legitimate publishers to some degree, but try to supplement their sites’ traffic by buying cheap clicks. Any click traffic offered for a fraction of a cent is likely fake, he said. "The vast majority of publishers are good legitimate players in an industry that is unfortunately pointing the finger at them when it comes to fraud. In reality, they themselves are victims of bad players that have infiltrated the industry. More should be done to root out these bad players without collateral damage to the honest publishers," Shechter told Real-Time Daily via email. "The good news is that we don't have a 20, 30, 50% fraud problem (depending on who you follow). Our industry has a 3% fraud problem and if we can clamp down on that, everyone but the criminals will be much better for it," he said.

In a blog post on the study, Fraudlogix noted the characteristics of ghost sites: They are often categorized as news and news feeds, “are often used because they automatically update and can make a site seem fresh without a publisher having to touch it.”

Ghost sites often generate millions of impressions a day but their global Alexa rank is in the millions. They also have private domain registration, and cookie-cutter templates.