Fraud Costs $5.13 for Every $1 in Loss, LexisNexis Risk Solutions Finds

Merchants wrestle with fraud every day, lamenting how much is lost in each bad transaction. LexisNexis Risk Solutions, as it’s done for a number of years, has quantified the actual cost beyond the item’s value.

In 2026, the total cost of every $1 in fraud is $5.13 in the United States and $5.23 in Canada for retailers and e-commerce merchants. That is up from $4.61 and $4.52, respectively, from 2025. This marks the first time the $5 threshold has been crossed in both markets, the company says.

What’s changed is that new attack vectors are having an impact. LexisNexis Risk Solutions says fraud risk is increasingly distributed in digital and physical channels, payment types, and customer touchpoints.

“Online and mobile channels now account for most fraud costs, representing up to 83% for e-commerce merchants. Common fraud types include chargeback fraud, lost or stolen merchandise and fraudulent returns, reflecting the breadth of threats facing merchants today,” the Atlanta-based company says.

For U.S. retailers, the top three fraud loss types were chargeback fraud at 12%, and lost or stolen merchandise and fraudulent requests for a return or refund, each at 11%. It was similar in Canada with chargeback fraud at 14%, lost or stolen merchandise, 14%, and scams and impersonation fraud at 13%.

For U.S. e-commerce operators, chargeback fraud accounted for 12% as did first-party fraud, followed by lost or stolen merchandise, 11%. In Canada, fraudulent requests for a return or refund accounted for 16% of fraud losses, followed by scams and impersonation fraud at 16%, and chargeback fraud at 14%.

Payment cards, in both countries, accounted for large shares of fraud losses by payment type.

Card transactions, at 26%, garnered the biggest share of fraud costs by payment method for U.S. retailers, and rose to 31% for U.S. e-commerce merchants. In Canada, card transactions were cited in 43% of fraud losses for retailers, though digital wallets, at 26%, outpaced cards at 20% for Canadian e-commerce merchants.

Additionally, the cost of fraud has increased substantially over time. It was at $2.40 in 2016 and now has more than doubled.