BUSINESS Insight Sponsored by Busey Bank Fraud Costs, Volume Continues to Rise in 2021 LexisNexis® Study Highlights Fraud Trends in Financial Services Industry Fraud is an unfortunate fact of life in today's world, and fraudsters are relentless, constantly seeking new vulnerabilities to exploit. What's more, according to the LexisNexis Risk Solutions 2021 True Cost of Fraud study'. considered one of the best indicators of current fraud trends in the U.S. and Canadian retail and financial services industries, fraud was more prevalent and more complex than ever over the past year. BuseyBANK For the financial services industry, and banks like Busey, this means being prepared for all types of fraud and identifying new threats, including some that may not be detectable with current risk mitigation processes, while implementing and updating security measures to help protect customers. The study, which included a comprehensive survey of more than 500 risk and fraud executives in financial services and lending companies, highlights five key takeaways: Business I Wealth Management I Personal Fraud Costs Continue to Rise. The cost of fraud for U.S. financial services firms is 9.9 percent higher than before the pandemic. For every dollar of fraud loss in 2021, U.S. financial services firms saw $4.00 in costs, up from $3.64 in 2020 before the pandemic. Those costs represent the transaction face value for which firms are held liable, fees and interest incurred, fines and legal fees, labor and investigation costs and external recovery expenses. Number of Fraud Attacks Climbing. The average volume of monthly fraud attacks on banks earning more than $10 million in annual revenue increased from 1,977 to 2,320. Building Business. Fraudsters Increasingly Target Mobile Channels. Where mobile transactions are, fraudsters tend to follow, as 98% of financial-services firms surveyed reported that fraud targeting mobile has increased. Mobile transactions accounted for 29 percent of U.S. banks' fraud costs in 2021, up from 20 percent the year prior, while online banking accounted for 33 percent of costs, up from 26 percent. In-person fraud accounted for 21 percent of fraud costs in 2021, down from 29 percent in 2020. There is also a significant percentage rise across financial services and lending firms for malicious bot transactions. It is difficult to identify such bots and other types of fraudulent transactions involving synthetic identities. Growing Wealth. Since 1868. Fraud Occurs Across the Customer Journey. Fraud losses take place across all stages of the customer journey-from new account opening to account login to the distribution of funds from a bank or investment account or a loan. Among U.S. banks, the distribution of funds stage was identified by 43 percent of respondents as being the phase of the customer journey most susceptible to fraud, followed by account login. Banks noted that identity verification was a top challenge for online and mobile channels at all stages of the customer journey. Fraud Complexity Increases. Fraud has become more complex, and various risks can occur at the same time with no single solution. Best practice approaches involve a layering of different solutions to address unique risks from different channels, payment methods and products, and further by integrating capabilities and operations with fraud prevention efforts. With the relentless persistence, ever-increasing sophistication and rising costs of fraud attacks, it's more important than ever to find a bank you can trust to look out for your personal information and financial wellbeing. Recognizing the importance of safeguarding customers' finances as well as personal information, Busey Bank implements state-of-the-art technology across all digital banking channels to ensure your banking experience is not only easy to use, but as safe and secure as possible. I OFFICIAL BANK OF THE FIGHTING ILLINI To learn more about Busey's suite of digital banking products, or to find out more about fraud and how to deter it, visit busey.com. "Lexisticxis Inue Cost.of Eraud Study busey.com/chicagoland Member FDIC BUSINESS Insight Sponsored by Busey Bank Fraud Costs, Volume Continues to Rise in 2021 LexisNexis® Study Highlights Fraud Trends in Financial Services Industry Fraud is an unfortunate fact of life in today's world, and fraudsters are relentless, constantly seeking new vulnerabilities to exploit. What's more, according to the LexisNexis Risk Solutions 2021 True Cost of Fraud study'. considered one of the best indicators of current fraud trends in the U.S. and Canadian retail and financial services industries, fraud was more prevalent and more complex than ever over the past year. BuseyBANK For the financial services industry, and banks like Busey, this means being prepared for all types of fraud and identifying new threats, including some that may not be detectable with current risk mitigation processes, while implementing and updating security measures to help protect customers. The study, which included a comprehensive survey of more than 500 risk and fraud executives in financial services and lending companies, highlights five key takeaways: Business I Wealth Management I Personal Fraud Costs Continue to Rise. The cost of fraud for U.S. financial services firms is 9.9 percent higher than before the pandemic. For every dollar of fraud loss in 2021, U.S. financial services firms saw $4.00 in costs, up from $3.64 in 2020 before the pandemic. Those costs represent the transaction face value for which firms are held liable, fees and interest incurred, fines and legal fees, labor and investigation costs and external recovery expenses. Number of Fraud Attacks Climbing. The average volume of monthly fraud attacks on banks earning more than $10 million in annual revenue increased from 1,977 to 2,320. Building Business. Fraudsters Increasingly Target Mobile Channels. Where mobile transactions are, fraudsters tend to follow, as 98% of financial-services firms surveyed reported that fraud targeting mobile has increased. Mobile transactions accounted for 29 percent of U.S. banks' fraud costs in 2021, up from 20 percent the year prior, while online banking accounted for 33 percent of costs, up from 26 percent. In-person fraud accounted for 21 percent of fraud costs in 2021, down from 29 percent in 2020. There is also a significant percentage rise across financial services and lending firms for malicious bot transactions. It is difficult to identify such bots and other types of fraudulent transactions involving synthetic identities. Growing Wealth. Since 1868. Fraud Occurs Across the Customer Journey. Fraud losses take place across all stages of the customer journey-from new account opening to account login to the distribution of funds from a bank or investment account or a loan. Among U.S. banks, the distribution of funds stage was identified by 43 percent of respondents as being the phase of the customer journey most susceptible to fraud, followed by account login. Banks noted that identity verification was a top challenge for online and mobile channels at all stages of the customer journey. Fraud Complexity Increases. Fraud has become more complex, and various risks can occur at the same time with no single solution. Best practice approaches involve a layering of different solutions to address unique risks from different channels, payment methods and products, and further by integrating capabilities and operations with fraud prevention efforts. With the relentless persistence, ever-increasing sophistication and rising costs of fraud attacks, it's more important than ever to find a bank you can trust to look out for your personal information and financial wellbeing. Recognizing the importance of safeguarding customers' finances as well as personal information, Busey Bank implements state-of-the-art technology across all digital banking channels to ensure your banking experience is not only easy to use, but as safe and secure as possible. I OFFICIAL BANK OF THE FIGHTING ILLINI To learn more about Busey's suite of digital banking products, or to find out more about fraud and how to deter it, visit busey.com. "Lexisticxis Inue Cost.of Eraud Study busey.com/chicagoland Member FDIC