Fraud Management & Cybercrime , ID Fraud

Why Auto Industry Has Seen a Massive Increase in Fraud

Point Predictive's Justin Davis on Auto Loan Fraud
Justin Davis from Point Predictive

Despite the popular perception of identity theft as a major cause of fraud, it accounts for only 20% of auto loan fraud risk while income and employment misrepresentation account for 60% of loan losses, says Justin Davis, fraud consultant at Point Predictive.

See Also: Kaspersky Lab's New Focus on Fraud Prevention

"Income misrepresentation is hard to catch without really causing friction for consumers. In the auto industry, you have lenders but you also have to worry about the dealership. A lot of dealers have also started committing fraud," says Davis.

"Rather than just accepting a payslip, it is important to verify forged documents by verifying income history. It is important to keep an internal list of fake employers," says Davis.

In a video interview with Information Security Media Group, Davis discusses:

  • The latest trends in auto loan fraud space;
  • Why auto loan fraud has increased in the last decade;
  • Tools to leverage to catch income misrepresentation fraud.

Davis is fraud consultant at Point Predictive. Previously, he was fraud and BSA manager at Digital Federal Credit Union, located in the Boston area. He also writes the Perpetual Chess blog about financial crime. Davis built and implemented a fraud prevention program at the credit union as well as at a Fortune 500 company.

About the Author

Suparna Goswami

Suparna Goswami

Associate Editor, ISMG

Goswami has more than 10 years of experience in the field of journalism. She has covered a variety of beats including global macro economy, fintech, startups and other business trends. Before joining ISMG, she contributed for Forbes Asia, where she wrote about the Indian startup ecosystem. She has also worked with UK-based International Finance Magazine and leading Indian newspapers, such as DNA and Times of India.

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