2022 Fraud Predictions: Fraudsters Will Join Billionaires in Space

As 2021 wraps up, people still ask me how my wallet diet is doing. Unlike most weight loss gimmicks, I'm pleased to report that my billfold has only been getting slimmer and sleeker since I first talked about the wallet diet in my 2018 predictions blog.

Shockingly, post-pandemic, my wallet seems to be withering away; when I leave (work from) home, I often don't even think to bring it with me. But of course I bring my smartphone, which contains more of my life than ever before: credit and debit cards, vaccine pass, car insurance, and all manner of apps that I've woven into daily routines: Amazon and Walmart, PayPal and Venmo, drugstore, grocery and food delivery, banking, brokerage and more.

Our collective reliance on phones has a number of implications for fraud, and in 2022 I predict that fraudsters will be so dialed in to our mobile lifestyles they will ply their trade in more ways and places than ever-including space.

Pre-Pandemic Spending, Post-Pandemic Distractions

Just because people may be using their physical cards less doesn't mean we're not making fewer payments. Visa reported that its total processed transactions for the three months ended September 30 were 45.3 billion, a 21% increase over the prior year. In early November the Federal Reserve Bank of New York noted that after rising by $17 billion in both the second and third quarters of 2021, credit card use appears to be returning to pre-pandemic patterns.

As the pandemic has blurred boundaries between work and life, at this point we are comfortable making transactions, albeit distractedly, in all manner of places and situations: driving in our cars, parked on endless Zoom calls, walking the dog and at the gym. Opportunities to transact are limited by only one thing: cellular and WiFi connectivity.

You'll Soon Be Transacting in Space

That barrier is about to be blown out of the water and into the sky. Meme-loving billionaire and SpaceX CEO Elon Musk's Starlink, a project to build an interconnected internet network with thousands of satellites, is designed to deliver high-speed internet to consumers anywhere on the planet. (This may be a particular boon to third-world countries, as my colleague Anat Hoida recently commented.) And where connectivity goes, payments soon follow.

With Starlink service still in beta, SpaceX recently said that the network has over 100,000 users in 14 countries so far, with over half a million orders or refundable deposits placed by potential customers. You know what's coming next: payments processing company Shift4 just announced a five-year partnership with Starlink. CNBC reports:

Shift4 outlined that it will begin converting Starlink "domestic payment volume" to its services over the next 120 days. The payments company sees the SpaceX partnership as a "massive" opportunity, estimating $100 billion in Starlink subscription payments over the long term, based on Morgan Stanley's estimates for SpaceX's potential revenue growth.

Of course, Elon Musk and fellow billionaire space enthusiast Jeff Bezos are fighting over satellite internet bragging rights. But I am absolutely sure that won't stop the payment streams from flowing.

A Launch Pad for Fraudsters

Let me put all the pieces together for my 2022 fraud prediction: pre-pandemic appetite for spending plus post-pandemic levels of hurried, distracted phone use and unlimited access to satellite internet connectivity equals new opportunities for fraudsters of celestial proportions. Payment cards secure the vast majority of payments transacted on mobile devices, and this confluence of conditions can easily give fraudsters a launch pad for new schemes and scams.

What can banks do? It can be hard to stay focused on fraud defenses for consumer card payments, particularly as other transaction types rise. For example, in 2021 a surge in B2B and health-care claims payments in the US drove a 7.7% year-over-year increase in ACH transactions compared to the third quarter of 2021. Transactions totaled a whopping 7.3 billion, up by 520 million. Dollar volume totaled $18.1 trillion, a 1.375% increase.

In times of rapidly changing fraud patterns, banks and card issuers that use FICO's fraud solutions are protected by numerous advanced technologies that help detect more fraud, faster. These include cobots (collaborative robots), contextual intelligence, behavior sorted lists and flexible data ingestion, as well as FICO® Falcon® Fraud Manager's built-in functionality to handle real-time payments, P2P payments, card not present transactions, application and identity fraud, mobile wallets, payment cards, account takeover and more.

Slow Your Roll with Payments

As consumers, we need to take a page from the pandemic Zen playbook, stepping back a bit from being so deeply involved with our phones. We can make a New Year's resolution to stop checking our phones 63 times a day. We can slow down and carefully think through our actions before firing off payments or zinging money around through P2P apps. Prevention is the best defense to protect ourselves from card fraud, scams, and all manner of financial deception and trickery.

Slow down, stay safe and make a New Year's resolution to follow me on Twitter @FraudBird. Best wishes for 2022!

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