Class actions and mass tort claims are increasingly falling prey to fraud, regardless of whether they’re paid via digital payment or paper checks, according to a report by Western Alliance Bank and its wholly owned digital payments platform, Digital Disbursements. This surge in fraudulent claims comes as digital payments rise in prevalence, a reality that brings with it its own set of challenges.
The “2024 Digital Payments in Class Actions and Mass Torts” report – which reviewed data from 597 class action and mass tort distributions by 24 settlement administrators from 2019 through 2023 – provides an eye-opening exploration of the current state of claim disbursement. The findings from the data are startling. The report reveals that the number of claims displaying significant signs of fraud soared by a staggering 400% to more than 80 million in 2023, up from less than two million just a year prior in 2022.
This shocking upward trend marks an increase of 19,000% from the 421,000 claims identified with significant fraud indicators in 2021, thereby painting a concerning picture of a system grappling with fraudulent activities.
For more detailed insights and statistics, interested professionals can access and review the full report on the Law.com website. As such mounting cases of fraud threaten the integrity of legal proceedings and the diligent administration of justice, the need for effective legal and technical countermeasures against such fraudulent activities has become ever more paramount.