(MENAFN) A recent survey conducted by digital identity verification firm Socure reveals that the practice of falsely claiming non-receipt of a package, when, in fact, it has been received, is costing U.S. merchants and financial institutions over USD100 billion per year. This type of fraud, known as first-party delivery fraud, involves individuals using their identity to commit dishonest acts for financial gain. According to Socure, 35 percent of the 1,000 surveyed Americans between the ages of 18 to 77 admit to engaging in this deceptive practice.
First-party delivery fraud encompasses various dishonest acts, such as falsely claiming that a delivery for an online order has been lost to obtain a refund, opting not to pay off a credit card bill indefinitely, making a Buy Now, Pay Later purchase with no intention of repayment, or disputing legitimate financial transactions. The consequences of this fraudulent behavior are significant, contributing to financial losses for businesses and further exacerbating inflationary pressures as companies seek to offset these losses by raising prices.
Socure's survey highlights that Generation Z consumers are most likely to commit first-party delivery fraud, with 52 percent expressing a willingness to engage in the activity if there were no negative consequences. Alarmingly, 20 percent of Gen Z consumers do not consider this fraudulent behavior to be ethically wrong, a rate three times higher than that of Baby Boomers.
Yigit Yildirim, Senior Vice President and General Manager of Fraud and Risk Products at Socure, emphasized that first-party fraudsters target a wide range of financial institutions and merchants, including large national banks, community banks, credit unions, lenders, fintechs, and cryptocurrency platforms. The impact of this fraudulent activity extends across the financial sector.
To address the issue, platforms like Amazon, through which many online transactions occur, have implemented measures to combat unsolicited packages. Third-party sellers are explicitly prohibited from sending unsolicited packages to customers. Amazon encourages consumers who receive unordered packages to report them promptly. The battle against first-party delivery fraud underscores the broader challenges faced by businesses in navigating the evolving landscape of online transactions and financial security.
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