Forging Ahead in the Fight Against Fraud
As consumers increasingly rely on technology for financial activities, bad actors take advantage of expanding opportunities to execute fraud. To cope, banks and consumers must exercise continued awareness and education. Credit and debit card fraud losses peaked at $34.36 billion in 2022 as financial institutions face an environment rife with financial crime.14
CSI’s 2025 survey explored the prevalent types of fraud encountered by financial institutions and assessed the effectiveness of current prevention measures.
Common Types of Fraud
Among the most reported fraud types, card fraud, check fraud, fraudulent account opening and wire transfer fraud emerged as primary concerns.
Over four in ten banks identified card fraud (44%) and check fraud (44%) as the foremost challenges.
Fraudulent account opening (40%) and wire transfer fraud (39%) closely followed.
Additional types include account takeover (33%), P2P fraud (33%), phishing (31%) and insider threat (26%).
Fraud Prevention Effectiveness
While banks expressed concern about fraud, they are also generally confident in the effectiveness of their prevention measures.
Card and Check Fraud
Card and check fraud both ranked as the most common types of fraud institutions face, with 44% of bankers choosing these options. Approximately three-quarters of banks surveyed feel their prevention measures for card and check fraud are highly or very effective.
Card Fraud Prevention Measures
Highly Effective
Very Effective
Moderately Effective
Slightly Effective
Check Fraud Prevention Measures
Highly Effective
Very Effective
Moderately Effective
Slightly Effective
As one of the oldest and most persistent forms of financial crime, it seems check fraud may never go out of style. In September 2024, a trend on social media exploded in which people claimed to have unlocked a “money glitch” in a major U.S. bank’s ATM, only to later discover they had engaged in traditional check fraud. This resulted in significant consequences, including account holds and legal repercussions. Check fraud can also take the form of forgery, counterfeit or altered checks or check kiting.
Fraudulent Account Opening
Fraudulent account opening was another common type of fraud encountered by institutions, with 40% of respondents selecting this option. Fortunately, 75% of respondents agree their fraudulent account takeover prevention methods are effective.
Fraudulent Account Opening Prevention Measures
Highly Effective
Very Effective
Moderately Effective
Slightly Effective
Wire Transfer Fraud
Wire transfer fraud was also among the most prevalent types, with 39% of respondents selecting this option. Encouragingly, 78% of respondents believe that their wire transfer fraud prevention measures are highly or very effective.
Wire Transfer Fraud Prevention Measures
Highly Effective
Very Effective
Moderately Effective
Slightly Effective
Wire transfers remain popular with fraudsters due to their speed and finality. Despite these vulnerabilities, more than seven in 10 respondents feel their wire transfer fraud prevention measures are effective. Defending against wire fraud demands ongoing vigilance and a commitment to refining strategies. It is difficult to recover lost funds in wire fraud, so institutions should continue education to employees and consumers.
Industry Insight
Check fraud continues to plague institutions, with FinCEN reporting $688 million in reported suspicious activity related to mail theft-related check fraud.15 Further, FTC data showed consumers reported fraud losses totaling more than $10 billion in 2023.16
While only 31% identified phishing as a common type of fraud, it remains a popular tool to perpetuate fraud schemes. It’s critical that institutions continue educating consumers on common phishing schemes. Account takeover is another issue, growing more concerning given the rise in synthetic identities. To combat this, many institutions are embracing modern identity verification methods. When it comes to verification, there’s can be a tradeoff between friction and security, but using methods like ID uploads and biometric authentication accelerates onboarding and reassures customers.
Expert Perspective
AI-powered fraud detection and prevention tools empower institutions in the fight against financial crime. AI can ingest and analyze more data than a traditional fraud tool, leading to more efficient decisioning and fraud identification. As fraud trends change, models must also adapt, which they can easily do if powered by AI. By enabling real-time detection, AI fraud tools accelerate investigation and help institutions limit their financial losses.
Financial institutions should proactively educate their customers about misinformation and nefarious financial schemes. Scams and dubious “hacks” circulate quickly on social media, but institutions that provide consumers with information can mitigate while increasing the potential for new business as a trusted resource.