Digital Fraud: How to Address Its Harmful Post-Pandemic Effects?

The 2021 year is already the third attempt of the world’s adjusting to the harsh reality of the drawn-out quarantine and isolation. Though we’re all bitterly tired of living such a secluded life, the majority still accepts the personal responsibility for combatting the virus. Governments are updating the state unemployment insurance problems and constantly enacting lockdown orders to prevent the tumour’s growth. People are trying hard to follow personal hygiene measures and resort to the sheltered, remote lifestyle. However, there’s one force that plays against our joint efforts — cybercrime.

The recent statistics show that COVID-19 has been continuing to lend a hand to perpetrators aimed at making a profit on citizens’ flawed vigilance. Why so? The increased pace of life requires speedy action, that’s why today’s consumers heavily rely on mobile banking, saved authentication, and other digitalization perks. As a result, fraudsters also excel to get access to the users’ sensitive data and leverage it to their advantage.

21 Apr 2021 only confirms the alarming outburst of fraudulent activity in the US and globally as that’s the main reason for launching the International Fraud Prevention Conference 2021. And we, at Dashdevs, would like to keep you updated on this matter and share how to detect a red flag and prevent the victim state.

What Is Current Digital Fraud Statistics Starts Telling Us?

While the governments of the developed countries support the civilians in need through unemployment benefits, cybercrooks are seeking the opportunity to steal from such charity cases. Can you imagine that almost 60,000 complaints were sent to the FTC since COVID-19 started? In fact, this appalling news is only the particle in the myriad of post-pandemic cyber crimes.

To give you a fuller picture of what’s going on the global scale, here’s the short squeeze of the latest fraudulent cases from the Feedzai Report.

Impersonation scams – 23%

Though the scheme mechanism is common knowledge, many people still keep taking the bait and agree on satisfying the intruder’s payment request. The culprits, in this case, stem from the understanding of the human typical behaviour under the stress and choose the right moment and scenario pattern to call, text, or email the victim. In the end, the person who’s caught off guard mindlessly sends the necessary sum of money to the attacker. Why? The simple answer is the authority’s power. The victim is usually told to do that with the reference to some authority: directors, executives, or vendors. Not everyone would check everything twice before the actual payment, especially in a stressful situation, right? So, that’s how this strategy works, and it has confirmed its efficacy in the US setting in 2020: $43 billion were gained by the criminals after the direct communication with the affected parties compared to $13 billion resulting from the traditional identity fraud. Something to think about, isn’t it?

Account takeover scams – 22%

This type of fraudulent operation occurs right after getting access to the user’s credentials and card/account details. Having the necessary login information, fraudsters hurry up to transfer money wherever they need it. As both procedures don’t demand much time these days, the money quickly appears in the swindler’s hands and there’s a low probability of getting it back. In the UK alone, the extent of the account takeover scams has reached £14.6 mln in 2020. So, in case you’re a big fan of CNP transactions, now you have a good argument in favour of quitting this payment type and giving your preference to the more secure, two-factor authentication method. Don’t open your pocket to the grifter waiting for his easy prey!

Shopping scams – 22%

Another widespread tricky tactic after getting ahold of the consumer’s credential information is to spend the stolen money on the online purchase. Among the most impressive cheating shopping examples, one with buying a $5 million watch on Sift’s network triumphs. With the rise in online shopping and banking, this kind of money laundering has gained a 250% increase in 2020 with the weak spots in North America and Canada. What’s more, while 60% of all digital transactions were mobile-based, cheaters didn’t hesitate too, showing a 48% splash in the mobile cyber attacks. Pretty daunting!

Investment scams – 6%

Though this fraudulent scheme is less popular, it doesn’t mean that you shouldn’t expect such a bombarding attempt in your direction. As a rule, the victim is supposed either to deliver the payment to a fictitious fund or proceed with the fake investment. The most mainstream channel of communication here is cold calling, though the other forms of contacting the recipient can also be used. In 2020, a little more than one-third of total losses on investment scams was successfully returned to the affected parties, but it’s better not to over-rely on being the lucky exception. When it comes to solid assets, is your risk justified?

Romance scams – 3%

As loneliness is part of our hectic and contact-free life, online communication considerably helps us out. Meanwhile, in case of engaging in online dating, be sure to select trustworthy and safe platforms not to come across fake profiles and romance scams ploy. Under the latter, the suspicious activity targeted at luring your money out is meant. The reasons your online partner asks for your financial aid may vary, but the most common of them are health problems, visa and flight expenses, and private grief. So, if the girl you’ve met on the dating website only feeds you with promises of offline meetings and future sweet prospects, stay awake! 2020 has proved to be the romance scams trap by extracting £21.2 mln from the naive users. Finding a fate online is possible, but nobody cancels the safety measures abidance, okay?

As you see, these top 5 cheating schemes are now prevailing as the wrongdoers’ reply to the digital banking boom. Finding the system’s vulnerable spots, they’ve skyrocketed their attacks on e-commerce (83% rise in 2020), retail (61%), financial services (58%), and lending (40%). Even fraudsters appear to benefit from tech progress! However, is it a reason for being scared and abandoning online banking usage? Instead of making a hasty decision, we suggest you look through the list of cyber fraud averting tips first, as it’s always better to prevent than to cure.

How To Obstruct Digital Fraud Effectively?

For Businesses

Based on the latest fraudulent global trends, the best 3 steps to provide a digitally secure environment for your clients include the following:

1. Insist on using multiple layers of account defence. For this, always suggest your clients come through the advanced verification process, including biometrics and user behaviour analysis. Such a sophisticated authentication procedure will be the first stumbling block for the potential money hunters to deal with, and it’s usually proved to be a tough nut to crack, especially in combination with the other safety measures. In addition, this is a good way to fight with botnets and synthetic identities, so your mission here is two-folded.

2. Promote a high awareness level among your users. Your task here is to work out the ongoing updates strategy for your customers to know how to protect themselves and decipher the alarming red flags in time. The information channels can be different, depending on your target audience portrait, but the regularity is what matters more here. Repetition is the mother of tuition indeed.

3. Keep an eye on the protection of your customer relationships. With this in mind, choose the best practices to guarantee your users’ personal information security and work together with law enforcement, the telecommunication industry, and the government to enhance it even more. Remember that the unity of physical and digital identity data will help you get the total picture of the customer, and that’s the key to strengthening your common ties against cyber fraud threats.

For Average Users

Though businesses are responsible for laying the foundation for your convenience and secure usage of their products/services, personal responsibility is no less significant. So, on your side, you’re to follow the basic security measures from A to Z:

A. Agree on automatic updates of your devices. This rule is for everything: your computer, laptop, tablet, and mobile phone. Not to forget about the regular OS renovation, switch this process to the automatic mode.

B. Use the anti-virus and -malware software. The defence from botnets, spyware, and keyloggers is the crucial method of your machine security and anti-fraud resistance, so don’t ignore it.

C. Develop enviable password habits. Using one easy-to-memorize login information for different sources/platforms, you inevitably raise your chances of being robbed. Don’t take the high road and select the elaborate mix of letters, numbers, and specific symbols instead. Plus, remember to alter it every 3-6 months.

D. Protect your home network. Except for the portable devices you use on a daily basis, ensure locked access to your Wi-Fi and select the appropriate encryption method. The password complexity is equally important there too.

E. Auto-lock your phone. Nowadays it’s hard to imagine the user not using a passcode/fingerprint/face recognition function to make your handy device secure from the intruders’ intervention into your personal data. But if you still belong to the minority camp, it’s time to change your attitude!

F. Save private files to the online storage. This refers to contacts, photos, and other sorts of media you’re afraid of losing or deleting. Google and iCloud will readily provide you with the best data support according to high-quality care standards. But, anyway, never upload your financial credentials there!

G. Avoid opening suspicious files and links. This simple step would be to increase your identity protection and keep a lid on possible money fishing attacks. Keep your critical thinking turned on!

H. Don’t disclose your sensitive information to other parties. Actually, a bank or the police won’t request you to transfer money to a safe account or share your PIN/password/passcode details with no clear-cut purpose. Thus, if you’re abruptly asked for that, take a break and think for a while. Or better contact your bank or the corresponding authority directly to clarify all the truth.

I. Be critical, if not suspicious. If it’s a matter of your data security and financial well-being, these traits are vital. Don’t let anyone catch you on the hook by the attractive offers/sales/prices that are too good to be real. In case you have a serious doubt, research before buying or investing.

Z. Stay away from sending money to unknown people. This is particularly true in the case of online acquaintances. Be double attentive to inconsistencies in the user’s stories and grammar errors — these can be the apparent signs of a bot or a fake profile contacting you. Don’t dismiss the possibility of scams!

Successful Anti-Fraud Cases To Consider

Paypal

This is a company that can definitely boast about strengthening its security reputation during the COVID-19 pandemic. Specifically, they’ve launched the Advanced Fraud Protection technology that allows large enterprises to monitor all signups and transactions in the open and manage the accounts thoroughly. What’s more, Paypal indoctrinates its users to engage in the independent checking of the account data as well to combine the efforts against any type of money laundering. And though it seems almost impossible to make users check the transactions history daily, they’re at least advised to set the limits to the number of purchases and total spending amount, check the payment request messages before confirmation, and be smart while choosing the password. Furthermore, the company constantly works on new software and anti-fraud updates to make their consumers’ experience safe and sound.

Visa

This financial services corporation also toils to guarantee top-level security standards to their customers. In particular, Visa has made a hype over the combination of CNP and COF payments, which works well for the users’ benefit and diminishes the risks of fraud attempts at the same time. Besides, their Visa Risk Manager tool does groundbreaking work in blocking the accounts in terms of emergency, automating transactions verification, and showing alerts while having any doubt about the nature of the payment procedure. Altogether, these functions take up the users’ security status up to the notch, while plenty of educational materials on the official website and newsletters add more to this generous goal.

Wait for a sec, let’s recap!

No doubt, the COVID phenomenon has brought new challenges in personal data protection to both businesses and users. Nevertheless, we truly believe that the deliberate abidance with the latest tech updates and basic security measures will guide you through this storm to a comfortable shelter. So, don’t panic! Instead, look through the list of tips mentioned above once again and try the things you’ve never done before. This ‘glass half full’ approach will let you perceive the harsh reality of today with dignity, readiness, and discretion. Go ahead with DashDevs!