Some 55% of all bank fraud cases reported in India are tied to third-party account takeovers that involve unauthorised individuals taking over someone else’s bank account, email account, or social media profile without the account owner’s permission, said Tel Aviv-based BioCatch, a firm that specialises in digital fraud detection.
Third-party account takeover fraud still represented a bigger slice in the fraud pie of the country than social engineering scams, BioCatch said in its “2024 Digital Banking Fraud Trends in India” report. In December 2023 alone, BioCatch, from its massive store data, analyzed over 350 million possible vulnerability sessions.
“India is the first ever country we are focusing solely on to take an in-depth look at the latest fraud risks and prevention strategies for banks in the country,” the study said.
According to the report, mules were a massively underreported plague in the banking industry and every device found to participate in mule activity in India logged into an average of 35 accounts each. Fraudsters were accessing Indian mule accounts from outside the country. BioCatch found more mule activity in Bhubaneswar (14%) than anywhere else in the country, while Lucknow and Navi Mumbai accounted for 3.4%, Mumbai 2.2%, Bhagabatipur and Gobindapur in West Bengal 1.7% and 2.6%, respectively, Bengaluru 1.8%, and Cuttack 1.6%.
BioCatch Director of Global Fraud Intelligence Tom Peacock said the prevalence of mule accounts potentially represented the most under-the-radar trend in the entire fraud space. “The mule accounts banks succeed in identifying almost certainly represent just the tip of the iceberg. Indian financial institutions must employ more robust security measures to both detect and then shut down these sprawling mule networks,’‘ he cautioned.
