Fraud Management In APAC: What’s New In 2024?

by Meng Liu, Senior Analyst, Forrester Research

Much has changed since I last analysed the fraud management landscape in the Asia Pacific back in 2022. The persistence of the digital era has transformed digital businesses, making fraud attacks ever-present. In fact, APAC is suffering more than most regions, with its fraud attack rate above the global average. My new report outlines the latest trends in fraud management, including evolving fraud patterns and technology adoption trends, to offer fresh guidance for security, risk, and payment professionals in APAC.

Fraudsters Are Employing More Sophisticated Fraud Attacks

In the rapidly growing digital landscape of the APAC region, fraudsters can capitalise on digitalisation and prey on financial institutions (FIs), merchants, and consumers. Deepfake technology has gotten increasingly complex, which makes both consumers and businesses fall prey to fake, yet convincing, fraudulent audiovisual content. Social engineering has also gained traction and sophistication, leveraging deep insights to deceive victims into divulging sensitive information.

Such scams are dangerous, as they trick victims into voluntarily initiating fraudulent transactions, leaving little room for FIs to react. Invoice fraud is also becoming a significant challenge. As businesses transition from paper invoices to e-invoicing, fraudsters exploit digital channels, particularly business email, to launch attacks. They counterfeit electronic invoices and use fake email addresses to deceive buyers into making payments to illegitimate suppliers.

AI/ML Has Revolutionised the Fraud Management Space

The AI boom and advances in ML have enhanced technology solutions for FIs and merchants to combat fraud. Generative AI (genAI) creates synthetic data, automates analytical tasks, and generates dynamic risk assessments. Companies can use genAI to simulate complex fraud scenarios to train detection models. This ensures that they are prepared for the latest fraud techniques. Explainable AI has further stimulated transparency and trust in the fraud management landscape as regulatory demands for clarity and fairness intensify. This has bolstered client confidence in decisions made by AI, fostering a culture of accountability within the risk decision-making processes.

Harnessing Tech and Teamwork

Fraud management is becoming more and more challenging for organisations in APAC, yet a clear way to outpace increasingly sophisticated fraud attacks hinges on continued collaboration and key technology adoption:

• Embrace new tech. Embracing new technology will ensure that your organisation is constantly up to date in this constantly evolving journey, as fraudsters will continuously engage new technology to initiate more sophisticated fraud.
• Collaborate across teams. Collaboration in your organisation, particularly across the operations of the fraud management and anti-money laundering teams, will improve knowledge sharing and streamline processes, boosting operational efficiency in this long-term journey.
• Share data across institutions. Data sharing across institutions is also key, as this will broaden the scope of fraud monitoring and introduce a novel level of depth and precision.

This is a constantly evolving landscape. Download the full report, Top Trends Shaping Fraud Management In Asia Pacific, 2024, or schedule a guidance session or inquiry with me to discuss how you can protect your organisation from sophisticated fraudulent attacks.