Article
Fraud’s identity crisis: Executive perspective
Unpacking our report on how verified accounts, familiar behavior, and AI are driving fraud in 2026.
Fraud no longer looks suspicious
Fraud’s identity crisis is as much about those trying to catch it as it is about those perpetrating it. While fraud has always been part of commerce, what’s changed is where it hides and how it appears.
For most of the past decade, the working model for risk teams was relatively simple: Flag what looks unfamiliar. New devices, unusual locations, credentials that don't match. That logic still holds for what it was designed to catch: classic risk patterns such as account takeover, stolen passwords, phishing attempts, and logins coming from compromised devices or unexpected regions.
When I speak with risk teams, one thing is increasingly clear: The fraud growing fastest today often doesn't trigger traditional risk signals. It comes from verified accounts, recognized devices, and behavior that clears every checkpoint. Now, fraud blends in with legitimate customer behavior.
That means risk teams face a different kind of problem, one that can’t be solved by tightening controls alone, because it’s often the controls themselves that are being exploited.
Five themes shaping fraud in 2026
For our 2026 fraud report, we analyzed 2025 transaction data from the Adyen platform (US$1.6T in data) and surveyed 1,000 decision makers at US-based enterprises.
Five themes emerged:
1. Fraud has become systematic. Automation has turned fraud into a continuous test-and-learn cycle. Tactics are deployed, refined in real time, and scaled quickly, with successful approaches repeated across environments and targets.
2. Good customers have learned to game the system. First-party fraud and policy abuse increasingly operate within legitimate customer journeys. Merchants no longer need to only verify identity; they also need to understand intent.
3. Precision drives growth. The cost of stopping fraud is increasingly measured in customer lifetime value, not just prevented loss. False declines, rising manual review costs, and blanket controls suppress growth.
4. Identity cannot be a static indicator. Point-in-time checks are no longer sufficient. Trust is built over time through behavior, history, and recognition across sessions, devices, and environments.
5. Trust must extend beyond the transaction. As AI agents begin to act on behalf of customers, fraud prevention must start earlier, with the systems that govern behavior before payment occurs.
In short, fraud is outpacing the systems built to stop it. That doesn't make the problem unsolvable, but it does mean that businesses must expand their understanding of risk, trust, and identity.
The merchants and platforms gaining ground are the ones who have stopped treating fraud prevention and customer experience as competing priorities. In 2026, fraud prevention is no longer just a security function or operational safeguard. It’s a commercial strategy.
