Many companies have strengthened their digital onboarding processes to make it harder for fraudsters to create fraudulent accounts. Document verification, mobile phone number checks, and other validation mechanisms have helped improve security at this initial stage.
However, transactional fraud also targets legitimate accounts. Attackers seek to take over existing accounts and perform actions such as changing personal information, updating the associated phone number, gaining unauthorized access through account recovery processes, or authorizing payments and transfers. Once they gain access to an account, they can carry out transactions on behalf of the legitimate account holder and maintain access for future attacks.
This challenge is already affecting financial institutions. According to a survey conducted by Federal Reserve Financial Services, 23% of surveyed institutions experienced account takeover incidents. The report identifies takeover as a growing threat, with a 7% year-over-year increase. Attackers who gain access to legitimate accounts can transfer funds, make unauthorized purchases, or change account information to prevent the rightful owner from regaining access.
Once attackers gain access, they can change passwords, update associated email addresses or phone numbers, modify personal information, or use stored payment methods. They may also attempt to maintain access or regain control even after the legitimate account holder has recovered the account.
This is why account recovery and changes to contact information require specific security controls. These are routine activities for legitimate users, but they can also be exploited for fraudulent purposes if authorized without assessing potential risk signals.
Meanwhile, UK Finance reported that losses from remote banking fraud in the United Kingdom fell by 27% in 2025, while the number of cases increased by 11%. This rise was driven by a 21% increase in mobile banking fraud cases. The divergence between financial losses and incident volumes highlights the importance of analyzing both metrics together.
A login from a familiar device may present a different level of risk than an account recovery request followed by a phone number change and a funds transfer. Companies therefore need to assess the context of each transaction or account activity and adapt their security controls based on available risk signals.
To do so, they can combine information about user identity, devices, account behavior, and transaction characteristics. When potential risk indicators emerge, organizations can require additional verification before authorizing sensitive actions. This approach enables transactional fraud prevention to address not only financial transactions but also changes to account information that affect how an account can be accessed.
Mobile identity solutions provide additional information to support this process. Among the capabilities described by the GSMA are Number Verify, which enables mobile phone number verification, and SIM Swap detection APIs, which help identify SIM changes. Depending on the services available in each market and how they are integrated into a company's systems, these signals can complement existing authentication controls and help detect potentially risky situations.
Mobile identity solutions do not replace existing security mechanisms, nor can they independently guarantee that a transaction is legitimate. Their value lies in providing additional signals that help organizations assess risk and determine when stronger security controls are necessary.
This matters most when users update contact information, reset credentials, register a new device, or authorize payments and transfers. Customer identity can be verified again whenever a transaction or account change warrants additional scrutiny, even if the customer has already completed the initial onboarding verification process.
Protecting the entire customer lifecycle means paying attention not only to account creation but also to the activities that follow. For companies, the challenge is to balance a seamless user experience with security controls capable of responding to risks that may emerge at any point.
At Plusmo, we offer a suite of mobile identity APIs that enables organizations to incorporate mobile network signals into their authentication and fraud prevention processes. By leveraging this additional information, companies can better assess the legitimacy of transactions and strengthen their security controls when the context calls for it.
