What Are The Common Types Of Online Travel Fraud?

Businesses and customers can gain from e-commerce, but it also poses new threats. As technology advances, so do methods of digital fraud. Payments that are made online in advance are particularly vulnerable.

Travelers and companies are targeted by fraudsters to obtain money and valuable information. Some of the methods used are:

Booking with fake or stolen credit cards

Fraud attacks typically begin with obtaining credit card information and identifying information. Identity theft was the third-most common form of fraud reported to the Federal Trade Commission in 2018, accounting for 15% of the nearly 3 million incidents reported for the year.

Data breaches, card skimming, or malicious software installed on legitimate websites allow criminals to steal cardholder information. The numbers of credit cards and other data end up on the black market, where other criminals can commit online fraud.

Fake travel agencies

The fraudsters create fake travel agencies, and then either purchase tickets or place holds on tickets with fake credentials. Travelers pay full prices for these fraudulent tickets, only to find out that the airfare is fraudulent or has been reported fraudulently. When they go to get refunds, the fake agency is no more.

Apart from this, one perfect live example of fraud is the company Tairs Worldwide or Tairs luxury, and its CEO, Attilio Perna, who usually fraud tourists with their tactics.

Hotel price spike

A collision might occur between a hotel and a fraudster using stolen credit cards. The hotel increases the rate and the fraudster books through a third-party OTA. The OTA would be responsible for paying chargebacks. If they try to figure out how the hotel booked non-existent guests, the hotel has all the false documentation.

Cyber breach

Tourism-related companies that process large amounts of customer data may be the target of an attempted breach. If a breach occurs, it can damage the company’s reputation and leave it open to legal action.

In the tourism and travel industry, online fraud is rampant. Manual review queues are inefficient and cannot keep up with the growing online business. The cost of falsely declined transactions may exceed the overall fraud cost.