New York is the nation’s epicenter for online fraudsters, followed by Atlanta, Chicago, Los Angeles, and Omaha respectively.
Leveraging a sample of nearly a billion transactions performed by select U.S.-based e-commerce merchants, ThreatMetrix reviewed the online activity for the first quarter of 2012, scoring each transaction with a fraud risk of low, medium or high.
High risk transactions are typically rejected automatically by merchants while medium risk ones tend to result in manual review. The top 150 U.S. cities were then ranked based on their percent of high and medium risk transactions.
“New York was ranked No. 1 in e-commerce fraud risk with transactions 1.5 times as likely to be at risk in comparison to second ranked Atlanta, and twice as likely in comparison to No. 3 Chicago,” said Alisdair Faulkner, chief products officer, ThreatMetrix. “As fraudsters grow more sophisticated and expand globally, it’s only natural that large cities with international profiles, easy access to shipping and high connectivity rates will become breeding grounds for new generations of cyber threats, including both fraud and malware.”
Cybercrime is becoming an increasingly worrisome problem for e-commerce merchants, financial institutions and other online businesses. In 2011, 25 million new, unique strains of malware were released – a number that is projected to explode to 87 million by the end of 2015, according to the Aite Group.
Cities like New York, Chicago and Los Angeles are a gold mine for cybercriminals that steal identities, passwords and credit cards. We would expect to see a highly connected city like San Francisco rank higher, but perhaps the relatively substantial penetration of Apple devices which are largely seen to be less vulnerable to malware explains its relatively low ranking, added Faulkner.
The top 10 list of U.S. cities for fraud origination, ranked from highest to lowest includes:
1. New York
4. Los Angeles
7. San Francisco
9. Washington D.C.
10. Lexington, KY.