Visa Says Airline Fraud Is Falling In The EU, So Why Are Losses Still Rising?

According to VisaNet MIS Fraud Insights, European airline fraud losses totaled $77.7 million for the year ending Tue, Mar 31, 2025. The study also indicates a reduction in overall fraud rates by 2.9% to single-digit levels. Sales within Europe's airline sector increased by 11.8% year-on-year, resulting in higher transaction volumes and subsequently more opportunities for fraudulent activities.

Visa's whitepaper reveals that 99% of airline fraud occurs in e-commerce, with card-not-present ticketing posing the most significant threat. Specifically, $77.07 million in fraud is attributed to online transactions, compared to $0.72 million involving card-present activity during the same period. Fraudsters typically acquire card details through social engineering, data breaches, or dark web marketplaces.

Fraud is increasingly cross-border, concentrated, and targeted. International sales represent approximately 65% of total fraud losses. In Europe, 47% of airline sales are cross-border, with three-quarters of this fraud involving issuers outside the region, placing additional pressure on airlines operating across various regions.

Visa's analysis identifies inter-regional transactions as accounting for 75% of cross-border airline fraud, with a blended fraud rate of 15.1 basis points. Intra-European cross-border transactions comprise 25% of fraud share, with a fraud rate of 2.3 basis points.

The Americas contribute 64% of the total fraud share, with North America alone responsible for 51%. The fraud rate is 20 basis points for U.S. cardholders and 16.9 basis points for Canadian cardholders. Latin America accounts for 13% of fraud share and a fraud rate of 23.7 basis points.

Asia Pacific represents 8% of fraud share with a fraud rate of 8.2 basis points, while CEMEA contributes 4% with a 4.9 basis points fraud rate. Visa notes that most cross-border fraud involves issuers outside Europe, highlighting a few corridors that generate a substantial portion of losses.

A fraud rate of five basis points equates to $5 of fraud for every $10,000 in payment volume, enabling airlines to quantify exposure across regions and adjust controls accordingly.

Visa outlines several tactics employed against airlines, with triangulation fraud being particularly damaging. Fraudsters create fake travel websites advertising discounted fares. Customers purchase tickets and pay the fraudsters, who use stolen card details to buy genuine tickets from airlines. Although the traveler flies, the airline incurs a chargeback.

Account takeover is also prevalent. Fraudsters use credential stuffing, brute force attacks, and exploit dormant accounts to access customer profiles, cancel bookings for vouchers, or alter account details to extract value.

Synthetic identities and mule accounts pose additional threats. Criminals combine real and false identity information to open accounts and exploit buy-now-pay-later schemes or installment offers. Friendly fraud, where customers dispute legitimate transactions post-travel, also results in financial losses for airlines.

Visa recommends airlines reevaluate fraud prevention at both intra-regional and inter-regional levels. Controls should safeguard revenue without adding unnecessary friction at checkout.

Cora Constantin, from Visa's Europe Tech and Risk Advisory, emphasizes, “Every transaction, booking, and journey relies on secure payments, protected data, and proactively managed risks.” She adds, “Using advanced analytics, real-time fraud detection, and AI-driven risk intelligence, Visa assists organizations in staying ahead of fraudsters.”

Visa highlights tools such as Account Takeover Protection, Click to Pay, Decision Manager, Payer Authentication, tokenization, and Visa Protect Risk Insights. Decision Manager leverages AI in real-time to automate fraud decisions. Tokenization replaces sensitive card details with tokens to mitigate exposure, while Payer Authentication utilizes EMV 3-D Secure to identify risky transactions prior to authorization and shift liability.

Visa Commercial Choice Travel, a B2B virtual card product, records a travel fraud rate of 0.0009 basis points, according to Visa's corporate Travel and Expense data. The whitepaper concludes that security, speed, and adaptability are essential throughout the customer journey.

Based on reporting by techround.co.uk.