When it comes to combatting fraud, nearly half of financial institutions in North America still rely mostly or entirely on manual processes in 2025, finds a new report—but fraudsters are getting more digitally savvy.
The data hails from the 2025 edition of LexisNexis’ “True Cost of Fraud Study” for the North America region.
The report also found that the cost of fraud is hitting record highs.
“Our latest study reveals that as fraud losses climb, many organizations still depend on manual processes that fail to match today’s sophisticated attacks,” says Kimberly Sutherland, global head of fraud and identity at LexisNexis Risk Solutions.
The impact of fraud can often be outsized. For example, the LexisNexis Fraud Multiplier meanders fraud’s effect on operations, compliance, reputation and customer trust—and this calculator finds that there is a total system cost of roughly $5 for every $1 of cash lost to fraud.
“The total cost of fraud—encompassing not only fraudulent transactions, but ripple effects such as increased compliance workloads and customer churn—continues to rise,” reads the report.
The survey from LexisNexis spotlights a hesitation by financial firms to more thoroughly adopt automated protections. However, this may be a mistake, warns Sutherland.
The fraud expert suggests that financial entities “with the lowest fraud costs adopt automation, AI and cross-channel visibility to detect more fraud faster through a multi-layered approach.”
“Fraud is a dynamic, escalating threat that touches every corner of an FI’s operations,” says Sutherland. “However, [financial institutions] don’t need simply accept it as a cost of doing business.”
Of course, fraudsters are also leveraging AI technologies to succeed in their criminal activity.
For example, malicious online bots present a mounting threat to institutions, according to the report, as rising bot attacks continue to muddy the waters of identity verification and more—especially as overly wrought fraud controls often lead to increased customer attrition for many North American institutions.
“Financial institutions need to find the right balance between protecting the business and pleasing the customer,” reads the report, “optimizing both security and the customer experience.”
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