Social distancing changes shopping patterns, and fraudsters have taken notice. They began to target the more digital-forward industries while following the money, according to data released Wednesday.
Millennials are the age group most targeted by fraudsters using COVID-19 scams, while telecommunications, ecommerce and financial services have been the most affected industries. Knowing this can help advertisers plan out their campaigns, from search to television.
Shai Cohen, SVP of global fraud and identity solutions at TransUnion, believes that since many transactions have shifted online, fraudsters have tried to take advantage and companies must adapt.
TransUnion analyzed fraud trends to reflect the changing economic environment with COVID-19. It used March 11, 2020 -- the date the World Health Organization (WHO) declared COVID-19 a global pandemic -- as a base date for its analysis.
The research found that the percentage of suspected fraudulent digital transactions rose 5% when comparing the period from Jan. 1-March 10, with the period from March 11-April 28. TransUnion identified more than 100 million suspected fraudulent transactions for the latter dates.
The countries with the highest percentage of suspected fraudulent transactions were Yemen, Syria, and Kazakhstan.
In the U.S., TransUnion found the cities with the highest percentage of suspected fraudulent transactions were Springfield, Massachusetts; Akron, Ohio; and Louisville, Kentucky.
To better understand the impact of COVID-19 on consumers, TransUnion surveyed 9,215 adults in the U.S., Canada, Colombia, Hong Kong, India, South Africa and the U.K. during the week of April 13. Some 29% of respondents said they had been targeted by digital fraud related to COVID-19, with Millennials targeted the most targeted at 34%.
TransUnion also found consumers who said their household income is negatively impacted by the COVID-19 are more likely to experience digital fraud, with 32% reporting being targeted by online COVID-19 scams, compared with 22% of people who were not financially impacted.
The report also analyzes the financial impact, surveying 2,063 adults between May 4 and 5, 2020, by TransUnion in partnership with third-party research provider Qualtrics Research-Services.
As of the time of this survey, 22 states have partially reopened, potentially driving 56% of the overall consumer financial impact to its lowest level since the first week.
Millennials are the only generation this week who report an increase in financial impact -- 68% vs. 64% last week. They also indicate the highest shortfall of all generations for upcoming bills and loan payments -- an average of $1,159.30.
Consumers in states emerging from shutdowns are less likely to report financial impact -- at 52% -- than those in states that are still shut down.
The job loss at 19% and reductions in work hours at 40% among impacted consumers remain near their highest levels. Hourly employees are experiencing higher levels of financial impact at 66%, compared with salaried employees at 59%.
Hispanic consumers are experiencing the highest level of financial impact at 66%, followed by Asians at 64%, African-Americans at 58%, and Caucasian consumers at 52%. Minority consumers are significantly more likely than Caucasians to have hourly jobs, at 56% vs. 38%.