Hong Kong Business Leaders Reported a Total Financial Loss of HK$92 Billion Due to Fraud in the Past Year

Confidence to identify multi-channel fraud attacks ranked lowest among surveyed markets

• Hong Kong’s suspected digital fraud attempt rate was 2.7% in the first half of 2025
• The top three predominant causes of fraud losses identified by Hong Kong businesses were third-party fraud, account takeover, and scam or authorised fraud
• Retail exhibited the highest rate and year-on-year (YoY) rate increase in suspected digital fraud from Hong Kong among industries analysed, surpassing all other countries and regions in the study

Insights from the newly released TransUnion (NYSE: TRU) H2 2025 Update to the  Top Fraud Trends Report revealed that 2.7% of all attempted digital transactions where the consumer was in Hong Kong were suspected to be digital fraud¹ in the first half of 2025, lower than the global rate of 3.8%. Compared to a year ago in the first half of 2024, Hong Kong’s suspected digital fraud dropped from 3.8%, indicating positive progress in the city’s efforts to combat fraud.

Despite this improvement, fraud continues to pose significant financial risks to businesses in Hong Kong. According to a business survey conducted by TransUnion, which gathered insights from business leaders across six markets — Hong Kong, Canada, India, the Philippines, the United Kingdom and the United States, 200 Hong Kong respondents reported their companies lost an equivalent of 7.1% of annual revenues on average due to fraud in the past year, representing a total of HK$92 billion. In addition to financial losses, more than half (51%) of respondents said they were extremely or very concerned about the impact of fraud on their businesses, underscoring the continued importance of fraud prevention as a strategic priority.

Hong Kong businesses strengthen fraud defences, but confidence in fraud identification remains subdued

Hong Kong businesses are actively strengthening their defences against fraud. According to the same business survey, three quarters (75%) reported optimising their fraud detection models at least quarterly with 21% doing so monthly. Hong Kong also recorded the highest percentage of business leaders among surveyed markets reporting deploying large fraud operations teams with more than 20 analysts. However, these efforts did not fully translate into confidence, with only 56% of Hong Kong business leaders feeling extremely or very prepared to identify fraud attacks involving multiple channels, placing Hong Kong at the lowest confidence level in the study.

To dive deeper into the root causes of fraud losses, business leaders in Hong Kong were asked to identify the main contributors over the past year. Third-party fraud, involving the use of stolen identities to open accounts, was cited by 26% as the leading cause. This was followed by account takeover (22%), where unauthorised individuals take over someone’s online account, and scam or authorised fraud (18%), a dishonest scheme intended to deceive a person into giving up something of value. These findings indicated a strong prevalence of identity theft and unauthorised access.

Phone fraud emerged as a significant concern for both consumers and businesses

On the other hand, fraud also remained a persistent threat to consumers. According to TransUnion’s Consumer Pulse Study for Q2 2025, more than one-third (37%) of Hong Kong consumers reported being targeted by email, online, phone call, or text messaging fraud from February to May 2025, with 4% falling victim. Among those targeted, vishing (fraudulent phone calls meant to trick consumers into revealing data) was the most common scheme, affecting 32% of respondents.

Hong Kong business leaders have also acknowledged concerns around phone-related threats and reported actively monitoring associated risks, as reflected in TransUnion’s business survey. Close to 80% of business leaders expressed being extremely, very or moderately concerned about phones being compromised or taken over by fraudsters during the transmission of one-time passcodes. Similarly, 43% ranked phone number reputation (phone number attributes that may signal fraud such as type of phone, fraud history and identity linked to it) among their top three most important fraud prevention solutions, the highest among all surveyed markets.

“It is encouraging to see Hong Kong making progress in combating and preventing fraud, as highlighted in TransUnion’s latest Top Fraud Trends Report. However, as fraudsters continue to evolve and adapt, our data also showed that both businesses and consumers remain aware of increasingly sophisticated schemes such as identity-based fraud and phone-related scams,” said Devon Sin, chief product officer at TransUnion Asia Pacific. “To maintain vigilance, businesses must tailor their fraud strategies to local realities, striking the right balance across technology, processes and awareness to stay ahead of complex threats. At the same time, individuals should proactively safeguard and monitor their personal information through trusted tools to reduce vulnerability and stay ahead of evolving risks.”

Fraudsters shifted tactics to exploit vulnerabilities across different sectors

Compared to the first half of 2024, financial services demonstrated encouraging progress in fraud mitigation, with the suspected digital fraud rate for attempted transactions where the consumer was in Hong Kong declining by 21% YoY. The improvements were likely supported by the Hong Kong government's continued efforts in cyber defence and public education². However, fraudulent activities remain persistent in the retail industry — a reminder that fraudsters are constantly seeking vulnerabilities and will not hesitate to exploit emerging opportunities. Sustained vigilance across all industries remains essential.

In the first half of 2025, retail recorded the highest suspected digital fraud rate among industries analysed for transactions where the consumer was in Hong Kong at 19.4%, representing a sharp 155% YoY rate increase. This positioned Hong Kong with the highest suspected digital fraud rate and YoY rate increase in the retail sector among all markets analysed. This trend aligns with official data from the Hong Kong Police Force, which shows that the majority of online scams reported during the first half of 2025 were linked to online shopping and job advertisements³. The telecommunications sector recorded the second highest suspected digital fraud rate from Hong Kong at 8.9%, followed by the logistics sector at 7.9%, with notable YoY rate increases of 128% and 117% respectively.

When it comes to the consumer lifecycle, fraudsters targeted vulnerabilities at the early stages of the digital journey, particularly during account logins (such as login attempts and failed login events). The suspected digital fraud rate during this stage stood at 10.8%, more than double the global average of 4.3%, making it the riskiest stage within the digital journey. In contrast, the suspected digital fraud rate during account creation (3.8%) and financial transactions (0.3%) from Hong Kong remained below the global average, possibly reflecting the city’s stronger onboarding controls and robust payment security.

Suspected digital fraud rate from Hong Kong by industry, retail tops in rate and year-on-year change

 Source: TransUnion TruValidate™

"Fraudsters are highly adaptive. Even as awareness among businesses and consumers grows, cybercriminals continue to search for vulnerabilities across sectors and at every stage of the digital consumer lifecycle," added Sin. "Protecting the organisations and customers is non-negotiable. An enterprise-wide approach that leverages smarter fraud detection and breaks down fragmented systems is essential. Ultimately, strengthening each layer of defense and remaining agile to evolve as fast as fraudsters do will help businesses foster long-term resilience, minimise unnecessary customer friction and set the foundation for a more trusted digital economy."

TransUnion came to its conclusions about digital fraud and data breaches based on intelligence from its array of TransUnion fraud prevention solutions. Specific country and regional data in the report includes Botswana, Brazil, Canada, Chile, Colombia, Costa Rica, the Dominican Republic, El Salvador, Guatemala, Honduras, Hong Kong, India, Kenya, Mexico, Namibia, Nicaragua, the Philippines, Puerto Rico, Rwanda, South Africa, Spain, the United Kingdom, the United States and Zambia. Download the TransUnion H2 2025 Update to the Top Fraud Trends Report for more information and insights about the global fraud trends.

1 The rate or percentage of suspected digital fraud attempts reflects those which TransUnion customers determined to meet one of the following conditions: 1) denial in real time due to fraudulent indicators, 2) denial in real time for corporate policy violations, 3) fraudulent upon customer investigation, or 4) a corporate policy violation upon customer investigation — compared to all transactions assessed. The country and regional analyses examined transactions in which the consumer or suspected fraudster was located in a select country or region when conducting a transaction. Global statistics represent every country worldwide and not just the selected countries and regions.

2 Hong Kong Monetary Authority: HKMA, HKPF and HKAB jointly announce new measures to strengthen the response to fraud and money laundering

3 HK Government Press Release: Remarks by Secretary for Security at media session after Fight Crime Committee meeting (with video) (only available in Traditional Chinese)