New Trends in Fraud and How to Avoid Them

Fraudsters are always utilizing new technologies to exploit gullible customers and companies. Emerging fraud patterns therefore pose serious difficulties for businesses trying to protect their clientele and brand. These fraud tendencies, which range from the sale of phony goods to an increase in approved push payment (APP) fraud, can result in identity theft, account takeover, and money mule operations. To keep ahead of thieves, find out about the top five new fraud trends.

1. False impressions

A deepfake is someone you've encountered if you've ever watched a video of yourself dancing flawlessly, heard a politician say something they've never uttered before, or seen a star say something completely out of character. Artificial intelligence algorithms are the engine behind these synthetic media productions. They are used by scammers to assume the identity of real people and cause havoc in their personal and professional lives. A malevolent deepfake can be employed for a variety of purposes, such as corporate espionage, stock manipulation, and electoral meddling and propaganda. This new fraud trend is revolutionary since it can get past current security protocols. For instance, identity verification programs that look for consistency, lip synchronization, abnormal blinking, and other signs of a false image can be tricked by fakes, as can face or voice recognition software.

2. Cooperation

As a result of widespread data breaches that expose millions of people's personal information on the dark web, criminals are using the "crime-as-a-service" model more frequently. They construct new, synthetic identities with stolen information that can be harder to identify. Businesses must respond to this developing issue with alternate authentication technologies, like liveness detection, in conjunction with passive behavioral biometrics. A covert agreement between businesses to coordinate acts for a malevolent goal, such as fixing prices or dumping chips at poker, is known as collusion. Criminals have also used it more recently to target consumers via unapproved A2P SMS routes. The secret is to balance removing risk and friction with satisfying the demands of today's digital customers. To do this, one must proactively monitor the risk landscape and stay up-to-date on developing fraud tendencies.

3. The Butchering of Pigs

Pig butchering scams take advantage of victims' financial difficulties and utilize social engineering to establish confidence. They might attempt to increase the size of their victims' wallets by persuading them to transfer money to fictitious cryptocurrency accounts. In order to persuade victims that they are missing out on a fantastic opportunity, they also attempt to take advantage of FOMO and other limitations, like time restrictions. Scammers use social media or dating apps to initiate and maintain numerous text messages and discussions with their targets. They go from group chats to one-on-one talks as their friendship grows, and finally they begin to demand big sums of money to "invest" in their plan. Victims frequently lose all of their savings and have to take out further loans from friends and relatives to make up the difference. Use Aura to monitor your banking and credit accounts to stay away from these kinds of scams.

4. Push orders

More sophisticated methods are being used by fraudsters to take advantage of people's need for simple, fast transactions. Businesses are experiencing an increase in fraud volumes due to a number of factors, including the pervasiveness of technology, the speed at which fraud-as-a-service and security technology are evolving, people's propensity to make mistakes or disregard best practices, and more. Push payments have no chargeback protection and are irreversible, which makes it simpler for thieves to take money from them. Payroll direct deposits, wire transfers, and mobile P2P services are a few instances. Additionally, employers are employing push payments to rapidly transfer employees' daily wages that have accrued to prepaid cards following shifts. In order to counter these new fraud trends, mid-sized companies need to reconsider how they prevent fraud. Learn how to use technology, forensics, and analytics for a more thorough approach by downloading the whole guide.

5. Theft of Identity

Generally speaking, fraudsters utilize data breaches to gather as much information as they can before using it to target certain individuals. For instance, they can go after a business owner in an attempt to obtain their banking or payment information. Alternatively, they may assault a person in order to obtain benefits or official documents. Identity theft instances decreased last year, even though there was a decrease in fraud incidents overall during the pandemic. Phishing scams, social engineering methods, and lax IT protocols are still being used by fraudsters to open accounts fraudulently. Customers should safeguard their personal information online and refrain from disclosing information to strangers in order to stop this. In order to stay ahead of emerging dangers, banks also need to make sure that their fraud and security departments collaborate. This will assist them in finding the ideal compromise between preventing fraud and friction.