Despite recording low and decreasing fraud rates, Hong Kong is experiencing disproportionately high digital fraud losses. According to a TransUnion survey conducted between November and December 2025, the median fraud loss in Hong Kong stood at US$6,155 (HKD 48,000) last year, the highest in Asia and nearly four times the global median of US$1,671 (HKD 13,000).

These higher-value incidents were driven primarily by identity theft, voice phishing (vishing), and money mule activity.

Identity theft emerged as the leading cause, accounting for 34% of losses among consumers who reported digital fraud last year.

Identity theft involves someone stealing another person’s personal information, such as bank details, passwords, or identification numbers, to open accounts, make purchases, or access existing financial services without the victim’s permission.

Following identity theft is vishing and money mules, cited by 31% of respondents each. Vishing is a type of scam where fraudsters use phone calls or voice messages to pretend being a trusted organization, such as a bank, government agency or technical support services to trick people into revealing sensitive information.

Money mules are individuals who transfer or move illegally obtained money on behalf of criminals, either knowingly or unknowingly. Money mules are often recruited through fake job offers, online relationships, or social media.

Targeting early stages of consumer lifecycle

Vulnerabilities in consumers’ digital lifecycle were particularly prominent during the initial stages. Account logins recorded the highest suspected digital fraud rate at 10.1% in Hong Kong in 2025, more than twice the global average of 4.3%. Similarly, the suspected digital fraud rate during account creation was also high at 9.7%, exceeding the global average of 8.3%.

This trend coincides with the prevalence of identity theft as the top cause of fraud loss, with personal information like name, address or phone number often stolen in data breaches.

In contrast, financial transaction suspected digital fraud in Hong Kong was significantly lower at 0.3%, suggesting that strong security protocols are in place for authenticated users.

In response, Hong Kong consumers have become increasingly vigilant and are gravitating towards businesses that guarantee stringent authentication and layered defenses. 79% of respondents expressed a preference for accessing online services such as bank accounts with explicit authentication, and 75% favored keeping multi-factor authentication permanently enabled.

When asked which extra security measures they preferred, consumers’ top answers were facial biometrics, cited by 19% of respondents, and fingerprint biometrics at 18%, highlighting a growing trust in advanced technologies.

Declining fraud rates

Despite high digital fraud losses, suspected digital fraud in Hong Kong declined between 2024 and 2025, dropping from 5% to 2.8% and falling below the global average of 3.8%.

These figures are also reflected in the city’s official statistics, which recorded a 2.9% year-on-year (YoY) decline in fraud cases in 2025, while Q1 2026 also showed a 0.6% YoY decrease.

This improvement can be in part attributed to sustained public initiatives and broader awareness campaigns, along with more cautious risk management practices adopted across the private sector.

In April 2025, the Hong Kong Monetary Authority (HKMA), the Hong Kong Police Force (HKPF) and The Hong Kong Association of Banks (HKAB) launched a series of new measures to prevent, detect and disrupt financial crime, including fraud and associated mule account networks.

These measures include expanding the use of Scameter, an anti-fraud database of suspicious phone numbers, bank accounts, emails, URLs, and online accounts; introducing legislative amendments to enable bank-to-bank information sharing; sharing best anti-fraud practices with banks; and strengthening publicity and education efforts to disseminate safety messages to customers.

Most recently, Hong Kong police arrested 13 people on suspicion of laundering more than HKD 113 million (US$14.4 million) using victims’ accounts on the government’s iAM Smart app to launder money through mule bank accounts, the South China Morning Post reported in March 2026.

Gen Z most susceptible to losses

The TransUnion survey, which polled thousands of consumers across 18 markets, also revealed notable global trends, highlighting that younger generations, particularly Gen Zs, are the most susceptible to losses.

In the last year, 39% of Gen Z said they lost money due to digital fraud, the highest of any generation, and above the global average of 26%. Broad use of social platforms, gaming platforms and cryptocurrency may play a role in the higher likelihood Gen Z would lose money.

Of the types of fraud Gen Z reported losing money to, trust-based fraud, including third-party seller scams on legitimate e-commerce sites and money mule scams, topped the list at 27% and 26%, respectively, higher than the 24% for these categories.

Looking at sectoral trends, the video gaming industry experienced the highest percentage of suspected digital fraud attempts globally in 2025 among industries analyzed at 12.8%, marking a 7% increase in volume over 2024. This was followed by communities at 8.1%.

In these sectors, bad actors often take advantage of entertainment and social-oriented site engagement to create fake user profiles to target consumers with scams and solicitations. Sometimes, they use this method to defraud consumers directly, but more often, they do so to secure personal information to perpetrate account takeover or new account creation fraud down the line.

Featured image: Edited by Fintech News Hong Kong, based on images by baddesinger5 and bloodua via Magnific