A wave of fraud is sweeping across Canadian businesses, with half of all companies experiencing fraud attempts in the past year. The problem is growing quickly, with fraud rates jumping 39% in just one year. For businesses that fell victim, the average loss was $7,800 – a costly blow to many operations.
Digital fraud is surging at an alarming rate. About 5% of all online transactions from Canada were flagged as suspicious in 2023. Since 2019, the volume of suspected digital fraud has soared by 202%, showing criminals are increasingly targeting online business activities.
Email scams and phishing attacks lead the pack, affecting 85% of businesses. Text scams (77%) and phone call scams (76%) follow closely behind. Some industries face more risk than others. Transportation companies are the hardest hit, with 61% experiencing fraud attempts. Finance, insurance, and real estate sectors aren’t far behind at 59%.
The costs extend beyond direct financial losses. Canadian companies spent $3.8 billion on employee salaries for fraud prevention and $2.9 billion on cyber security software.
Time wasted dealing with fraud affects 76% of victimized businesses, while 51% report negative emotional impacts. Customers are noticing too. About 42% of consumers abandon online shopping carts due to fraud concerns, and 93% say data security confidence is important for online transactions.
Many businesses are fighting back. Half have implemented stricter payment verification processes, while 36% increased cybersecurity investments. Employee training has been enhanced by 32% of companies. The Canadian federal government recommends providing tax credits and low-interest loans to help businesses make critical IT security investments.
The future looks challenging as fraudsters adopt new tactics. Business owners overwhelmingly fear (90%) that artificial intelligence will fuel more sophisticated scams.
Identity theft is rising, and ransomware attacked 13% of affected businesses in 2023. Cryptocurrency investment fraud is also becoming more common.
As digital fraud continues its rapid growth, Canadian businesses face mounting pressure to protect themselves while maintaining customer trust in an increasingly risky business environment.
For insights on cybersecurity and business challenges in today’s digital economy, visit Marketplace Niagara.
