8 key online fraud behaviors and patterns
Sift Science examined data from 1.3 million online transactions and profiles in various industries from August 2014 to August 2015. Data was cross-referenced with third-party data from FullContact to identify age and gender, computing fraud rate with the number of fraud users as a fraction of the entire sample size.
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Key findings:
- 3 a.m. is the fraudiest time of day, regardless of time zone. Also, fraudsters are more likely to transact during the weekdays
- Alaska has the highest fraud rate based on billing address while Delaware has the highest fraud rate based on shipping address.
- The Midwest has the lowest rate of fraud based on both shipping and billing addresses. However, Massachusetts has the overall lowest rate of fraud.
- Men are slightly more likely to be fraudsters than women.
- Users identifying themselves in the 85-90 age range are two and-a-half times more likely to be fraudsters than the average user.
- A user with two to four accounts linked to one device is eight times more likely to be fraudulent.
- Purchases worth $0-25 are twice as likely to be fraudulent, suggesting criminals test stolen credits cards for validity, trying low-value orders.
- Accounts less than three days old are three times more likely to be fraudulent, while accounts that are two months old are two times more likely to be fraudulent.
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“Fraudsters are enjoying success in the ever-changing online playground as the ecommerce marketplace ecosystem grows,” said Jason Tan, CEO and co-founder of Sift Science. “We continue to see fraud behavior consistent across various industries, and reveal identifying factors that help us track and score today’s most advanced fraudsters.”