Why businesses need to step up to beat the ‘internet wolves’

Sarah Golding, our Head of Fraud Consultancy & Sales Support, recently attended the annual CIFAS conference, ‘Perspectives in fraud and financial crime’. Here Sarah shares her views on the latest news.

At the conference hosted by leading fraud prevention organisation CIFAS, a range of interesting topics were debated, spanning fraud, vulnerability, prosecution, education and awareness, with insights from an array of industry voices.

The event also featured the launch of CIFAS’ newest report  ‘Wolves of the Internet’ which looks specifically into online identity theft, and examines how criminals are using websites available via Google to buy and sell personal data of British consumers. The report showed that fraudsters can buy bank details for £161 and passport information for just £40, allowing them to open fake accounts and take out loans, mobile phone contracts and credit cards, by accessing credit in the victim’s name.

This new report links closely to evidence shared in the recent Fraudscape 2018, which highlighted an increase within the identity fraud category, up 1% from 2016 to 2017 and totalling 174,523 cases, with 95% of those involving an innocent victim of impersonation.  More alarmingly, when compared over a 10 year period, that increase is a huge 125%.

There has, however, been a slight shift in targets during the last year, away from credit cards and bank accounts to telecoms, online retail and insurance. This suggests fraudsters are seeking out sectors that may have less stringent credit and fraud checks in place, as opposed to banks which have invested more heavily in fraud controls, such as device profiling.

As they seek to exploit the weakest link, fraudsters will continue to look for companies that are less advanced in their fraud prevention tactics, or where data of potential victims is more readily accessible, so it’s imperative that businesses step up and ensure they’re using the latest tools to combat potential fraud.

Unsurprisingly, the majority of identity frauds are carried out online, accounting for 84% in 2017, and with more customers than ever now accessing accounts through mobile devices, this is likely to remain high unless businesses take action to put more stringent checks in place.

CIFAS has also pointed to a 7% increase overall in the number of fraudsters hijacking the accounts or services of an innocent victim in 2017, with 24,070 cases of ‘facility takeover’, with plastic card accounts being the most frequent targets here.

Social engineering – using scams to trick people into providing confidential data – was the main method used by the fraudsters, either by phone or online. Worryingly, the over-60s are now the most commonly-targeted group for these kind of scams and, as we have found in our annual Fraud Report there is still a limited understanding of the social engineering tactics which fraudsters employ.

Education plays a major role here, both for businesses and consumers, in staying a step ahead. There’s no silver bullet when it comes to fraud – it’s an ongoing battle and businesses need to think about a layered approach so they can fight the fraudsters on all fronts.

Find out more about how we can help in the fight against fraud with our Fraud and ID solutions.