New Survey: Fraud May Be Down, Fraud isn’t only a risk to manage within financial institutions; it’s quickly becoming one of the most critical tests of trust between banks and their clients. As fraud continues to be a climbing concern at reported losses of $12.5 billion in 2024, consumer expectations for their financial institutions remain high. Abrigo recently conducted its second annual fraud survey to understand how fraud affects U.S. consumers and small businesses and what they expect from their financial institutions. The 2024 Abrigo State of Fraud report uncovered how prevalent fraud had become. Fast forward to 2025, and the picture has changed, but in ways that are just as concerning. According to the Abrigo State of Fraud report 2025, fewer people have experienced fraud this year, but the anxiety around it has grown, and so has the emotional fallout when it does happen. Here’s a closer look at how the numbers have changed and what those shifts might mean for your bank. Fraud Is Less Frequent, but the Pressure Is Rising In 2024, nearly half of the participants told us they had experienced financial fraud at some point. In 2025, the percentage of people who had experienced fraud dropped to 38%. That’s encouraging on the surface, but it doesn’t tell the whole story. Concern about fraud hasn’t dropped. In fact, it’s rising, particularly regarding new threats like AI-driven scams and identity theft. Even with fewer incidents, 56% of fraud victims still reported stress or anxiety, and more than 60% said they would reduce their relationship with their bank or credit union if they were defrauded. Customer attrition rates held steady, with about one in five respondents reporting they had left a financial institution due to fraud, regardless of fault. This underscores the growing pressure on institutions to respond swiftly and effectively to protect both reputation and retention. Customers Are Worried About — and Open To — AI Artificial intelligence has quickly become both a red flag and a green light for consumers. In 2024, 74% of respondents feared AI would increase successful fraud. In 2025, that number jumped to over 83%. But here’s the twist: While concern about AI is rising, so is trust in how it can be used to prevent fraud. This year, 44% of consumers and an impressive 69% of small business owners state that they would feel safer if their institution used AI-powered fraud detection. People are beginning to accept that fraudsters are using advanced tools, and they want their banks to fight back with equally sophisticated defenses. Transparency is key. Clients want to know what tools are being used to protect them and how those tools make a difference. Small Businesses Are Feeling the Pressure If you’re serving small businesses, the survey’s insights into how they’re being affected by fraud matter. Last year, half of small business owners had been targeted by fraud. This year, it jumped to nearly 60%. The reported fraud is not minor. More business owners are encountering check fraud and AI-assisted scams. Many of them are facing losses of over $10,000, and they’re spending hours, sometimes days, to resolve the issue. Small businesses also reported that they are more likely to walk away from a banking relationship if they feel unprotected. In this year’s survey, 30% of small businesses said they had ended a banking relationship due to a fraud event. That’s a loud and clear signal; this segment expects tailored fraud education, proactive tools and quick response when things go wrong. By Terri Luttrell, CAMS-Audit, CFCS, Abrigo Colorado Banker 12
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