Fraudsters no longer need the dark web to pull off their schemes. The proliferation of apps like Telegram and TikTok, along with advancements in generative AI, have enabled even amateur fraudsters to become skilled cybercriminals. As a result, account takeover (ATO) is causing significant disruption for businesses across markets.
In 2023 alone, ATO fraud led to nearly $13 billion in losses, up from $11 billion in 2022.
And more recently, across the Sift Global Data Network, ATO attacks increased 56% in Q3 2024 compared to the same period last year—a notable spike from the 24% increase YoY in Q2. Even for businesses seeing revenue growth, ATO fraud drains an average of 6% of monthly user revenue in some industries—equating to $60k in losses for every $1M in revenue.
Many businesses are waking up to this threat, with 70% of security leaders saying ATO is the greatest concern to their organizations, as it directly erodes trust, engagement, and performance across the entire customer journey. Worse, it leaves businesses vulnerable to future attacks due to compromised data and weakened security infrastructure. ATO can also have lasting and long-term effects on brands beyond lost transaction values. Our research found that 80% of consumers would stop shopping or shipping with a site or app due to unmitigated ATO.
Companies relying on traditional solutions often fail to detect ATO and mistakenly accept it as a cost of doing business, focusing their energy on preventing payment fraud at the moment of transaction and neglecting other critical points in the consumer journey. To effectively protect both your business and customers from these threats, it’s crucial to adopt a comprehensive approach that considers the full scope of ATO.
Account Takeover Fraud: The “Orphan” Threat
ATO is sometimes deprioritized within organizations, with many defaulting to broad security measures like MFA and anti-bot challenges for all users. While these tactics are designed to boost security, they frequently disrupt the customer experience and can jeopardize revenue. In reality, ATO is a complex, multifaceted threat that impacts various areas of a business, from cybersecurity through customer experience to finance.
A blanket approach to ATO can create gaps in accountability across teams, leaving it as an “orphan” threat with no clear departmental ownership. This fragmented responsibility often obscures the true cost of ATO fraud, which spans both soft and hard costs across different areas of the company. As a result, ATO often goes unrecognized as a significant burden, making it harder to address strategically.
Traditional solutions also often result in incomplete data and inaccurate insights, making it difficult to fully understand and mitigate the impact of ATO and the associated revenue loss. Decisions based on this fractured data result in poor risk mitigation and reporting, leading to higher customer dissatisfaction, lower acceptance rates, and more successful attacks that drain revenue and hinder growth.
To tackle this issue, Sift unifies insights and provides actionable data that helps teams address fraud collaboratively. Our AI-powered platform serves as a cross-functional command center, enabling security, fraud, and IT teams to create integrated workflows that comprehensively address risk. We help these departments work together and take ownership of ATO by uniting data and workflows, making them accessible and actionable.
Shining a Light on ATO
Sift is addressing the total threat presented by ATO and solving the orphan fraud problem with a new inventory of innovations and features designed to defend and drive growth. With these enhanced solutions, businesses can safeguard their users throughout the entire consumer journey, from the point of login to post-transaction, addressing the growing threat of account takeover. Sift’s ATO solution prevents a median of up to $4.2 million per year in fraud losses per customer. Our unique approach unites data and workflows across departments and removes barriers to revenue. As organizations sort out their internal ownership of account takeover, Sift’s AI-powered fraud platform becomes the single source of truth for ATO prevention.
With Sift’s newly-enhanced ATO solution, businesses can:
- Enhance Identity-Centric Accuracy: AI-powered insights, real-time behavioral analysis, and granular device fingerprinting provide richer context around risk and user intent throughout the consumer journey.
- Tap into Powerful Integrations: Unify and augment existing CIAM through low-code integrations with leading solutions like Ping Identity and Okta Auth0, accelerating time to value and strengthening identity management investments across the security tech stack.
- Fine-Tune Controls: Robust MFA capabilities and continuous monitoring after login deliver precise friction at the session level. Workflow templates help reduce time to value for new customers.
- Identify Fraud Patterns Faster: Enhance model accuracy with additional options for rapid detection of ATO fraud behaviors, such as email and password changes.
- Surface Meaningful Insights: Optimize your Sift Console for quicker identification and review of potential ATOs, with customizable advanced search capabilities that highlight patterns unique to your business.
- Accelerate Manual Decisioning: Gain faster, more efficient access to manual decision-making tools, empowering your team to act swiftly against threats.
- Streamline Protection: Leverage workflow templates to efficiently combat ATO fraud with proven strategies tailored to your industry.
Additional innovations include advanced risk signals for unique betting behavior and VIP Fast Pass controls that enable high value players to bypass friction requirements for high velocity transaction industries like iGaming and fintech, as well as expanded RiskWatch functionality for faster, more insightful manual reviews.
Leveraging Sift’s AI-powered platform, businesses can now achieve more accurate and comprehensive defenses against downstream fraud, ensuring a seamless and secure experience for their customers. By integrating with leading CIAM providers like Ping Identity, we help strengthen identity management investments and deliver a holistic solution to the orphan fraud problem.
For more ATO insights and recommendations for how to unlock the potential of a unified fraud prevention approach, check out this on-demand webinar.