Whether for the holidays or just a bimonthly trip, traveling has been a popular way for people to unwind and relax. As the process of ticket and hotel bookings becomes digitized, cybercriminals and fraudsters have also recognized the growing number of travelers as a potential goldmine for their illicit activities. Travelers being unfamiliar with their new surroundings can also fuel scamming schemes that they might be unaware of. Travel fraud is a massive problem that would-be travelers and businesses operating in the travel industry need to acknowledge. Read this article to find out in-depth information about travel fraud.
What is Travel Fraud?
Travel fraud is a type of fraud that occurs in the travel industry. Like any other frauds, it can become disadvantageous for customers and businesses. Travel fraud can occur in many forms, including:
- Travel website phishing. Fraudsters create fraudulent travel websites and emails that lure unsuspecting victims with cheap tickets and hotel rates. When the victim sends their personal information and credit card details to book, the fraudster can steal that data.
- Overpayment scam. Fraudsters offer victims discounted rates for tickets and hotels. Once the victim pays the downpayment fee, the fraudster disappears.
- Fake ticket scam. Fraudsters masquerade as legitimate businesses, offering tickets or hotel rooms but failing to actually book them, leaving victims unable to access their tickets or hotel rooms.
- Chargeback scam. Fraudsters book flight tickets/hotels using stolen credit card information, then cancel it and request a refund to their bank account.
- Mileage/points fraud. Fraudsters use mileage/points from stolen/fraudulent credit cards.
- Loyalty account theft. Fraudsters take over loyalty accounts to use the victim’s loyalty points.
According to ThreatMetrix, almost 20% of all transactions involved in the travel industry were fraudulent. 7.5% of the transactions involve device spoofing, while the other 6.9% involves identity spoofing. This data highlights how crucial personal data security is and the importance of being aware of tactics used by fraudsters to take over data.
Businesses can also be negatively affected by this, with airlines, hotels, and vehicle rentals being the main targets of fraudsters. Airlines, the most common target of travel fraud, can be affected when fraudsters create fraudulent websites for phishing schemes. That can lead to financial and reputation loss for the airline. Hotels can also be affected, especially by chargeback fraud and fraudulent bookings. Vehicle rentals can also be affected when fraudsters use stolen/fraudulent identities to rent vehicles.
According to Statista, international travel is predicted to bounce back by 55-70% in 2022, as it did in 2019. This prediction is correct as the numbers of post-pandemic travelers had returned to the numbers before the pandemic. With the numbers forecasted to grow over the next few years, how can travelers and businesses operating in the travel industry prevent the ever-increasing threat of travel fraud?
How to Prevent Travel Fraud
There are many things that you can do to prevent travel fraud. As a customer, you can try and keep in mind these things:
- Use a reputable booking website, and avoid fishy websites with promos that seem too promising, as these could be phishing schemes. Make sure that the website you use is legitimate.
- Always check your credit card statements and make sure there are no unauthorized purchases on your credit card.
- Using strong passwords can help prevent account takeovers.
- Be careful of what you share online, be mindful when you share information, and avoid sharing personal or password information with strangers.
As a business, there are also things that you can do to help protect your customers while also preventing the losses that may arise from travel fraud. These are:
- Using reputable travel vendors, only work with reputable travel vendors to minimize risks to your business and customer.
- Educate the employees, employees have to be educated and trained on examples of fraud schemes that are on the rise and signs of scams.
- Report fraud attempts. If your business is suspected of being a travel fraud victim, report it to authorities as soon as possible.
There are also extra steps that you can take to ensure the safety of your customers’ data and prevent fraud, such as using technologies like
- Digital onboarding: ensures that the person trying to create an account is who they say they are. That prevents people from using stolen identities and credit cards to access or create an account.
- Liveness detection: ensures that the person trying to register/accessing the account is present in real-time, preventing fraudsters from simply using photos of their victims to access their account.
- Digital signatures: an easy-to-use, safe, private, legally compliant, and eco-friendly digital signature system that is also legally recognized. It offers a convenient and secure method for digitally signing documents.
- Authentication solution: ensure the authenticity of each individual by utilizing biometric information to reliably and securely confirm a person’s identity.
These digital solutions can help your business automatically filter fraudsters from genuine customers when they try to book a trip by asking them to verify their identity.
Cybercriminals continuously find new gaps to take advantage of. That is why customers and businesses need to be aware of the tactics and vulnerable industries they may pose. The same is true for the travel industry.
ASLI RI has developed a number of digital solutions that can help businesses in the travel industry protect themselves from frauds. These solutions can help to verify the customer identity and prevent fraudulent transactions, ensuring that businesses and consumers can have peace of mind when traveling. Want to learn more about our extensive products? Visit www.asliri.id now.
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Last modified: October 18, 2023
