Callsign, the digital trust pioneer, today announced the results of their annual scams research, revealing the true extent of the damage to reputation that scams have.
Data* from 8000 consumers polled in nine countries about their experiences of scams has identified a 70% increase of consumers who say they have received a scam message. For 33% of those who have received a scam message, this was enough for them to stop using the company or service whose name the scammer used in the message.
The 2022 data also revealed that nearly half (45%) of respondents had lost money to scams, and 47% of those respondents’ told friends, family and colleagues about the experience.
The exponential global growth of scams means that the damage to reputation can spread quickly and have a lasting impact, and financial institutions recognize this with 67%** saying they face challenges retaining customers if they are associated with an online scam.
Consumers also think they’re good at spotting scams and they trust themselves more than banks to detect them with over half, (51%) believing they do the best job of protecting themselves from scams, with banks behind at 49%.
However, the types of ‘scams’ consumers cited that they can protect themselves from included all types of fraud such as phishing for PII data, romance scams, investment fraud, bots or malware for account take over purposes, and other undisclosed vectors. However, financial institutions (FIs) typically only consider authorized fraud, authorised push payments (APP) to be a scam – but this definition also varies across FIs and regions.
There appears to be a language gap when it comes to scams, with what consumers describe as a scam and what FIs call a scam differing. It is possible that consumer satisfaction is impacted, but not attributed to by FIs to scams. Therefore, the risk to corporate reputation is being underestimated because a bank’s reputation is being impacted by fraud more broadly than just scams.
This indicates that scams are not a linear experience for consumers. Stolen or socially engineered credentials are not just used to execute scams but can be deployed for other types of fraud, for example to take over accounts.
"Manipulating genuine people into authorizing payment to fraudsters has proven a very effective method, and it is growing exponentially as a result. These approaches damage trust in companies that reaches much more broadly than those directly affected. As a result, organisations need to consider anti-fraud technologies that address all types of fraud," said Steve O'Malley, Chief Revenue Officer, Callsign.
*Research was carried out in partnership with Opinium. The total sample size was 8000 adults with the following national breakdown: Canada, 1000; India, 2000; Indonesia, 500; Malaysia, 500; Philippines, 500; Singapore, 500; UAE, 1000; UK, 1000; USA, 2000.
**Callsign commissioned Forrester Consulting to conduct a survey of senior decision-makers from financial organizations across the globe. 40% were from North America, 20% were from the UK, 20% were from APAC, 19% were from the Middle East.