Saturday, April 19, 2014

Mobile payment, online transactions to face higher fraud in 2013 – Report

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The report said mobile payments, on-line transactions and others face more risk of fraud.

Mobile and Cyber space fraud will grow in 2013, making businesses and consumers more vulnerable to fraud and malware attacks on mobile devices, ThreatMetrix, one of the fastest-growing provider of integrated cybercrime prevention solutions, has said.

The firm said in a report that the most threatening cyber security trends and risks may emerge in 2013 as cybercrime threat landscape is rapidly expanding and evolving.

The expanding landscape, it said, include cyber warfare, data breaches, migrating malware, bring-your-own-device (BYOD), cloud computing, and mobile and social media fraud.

According to the firm’s report, in today’s threat environment, the reach of cybercriminals expands to more industries each year, with financial services, insurance, retailers, enterprises and government agencies especially vulnerable to new threats.

“This year, cybercriminals have become so advanced that security professionals are struggling to detect many of their attacks in a timely manner,” said Andreas Baumhof, Chief Technology Officer of ThreatMetrix. “As nearly every industry is increasingly targeted, businesses and consumers must make cybersecurity a top priority in 2013 to prevent fraud and malware attacks.”

“As Mobile Grows, Fraud Risk Increases – Mobile transactions are projected to reach $1 trillion by 2017, making businesses and consumers more vulnerable to fraud and malware attacks on mobile devices. Retailers and FIs (Financial Institutions) do not have the bandwidth to monitor every transaction for suspicious activity, so consumers must take measure to protect their accounts,” he said.

The firm also added that data breaches will continue to place top brands at risk in E-Commerce and Financial Services

“Data breaches continued at an alarming rate in 2012 including cyber attacks on such high profile brands as Yahoo, eHarmony, Zappos, LinkedIn, eHarmony, Global Payments and many others. Such attacks are expected to continue in 2013 as more security weaknesses are discovered by cybercriminals,” the firm said.

Malware, historically targeted at financial institutions (FIs), will increasingly affect retailers, alternative payments and digital currencies in the New Year. These targets lack the same stringent levels of malware protection that FIs have spent years developing. Retail customers who typically use the same password and save login details across several accounts are also placed at greater risk for fraud, the firm said.

Social media sites are making an effort to decrease the prevalence of spam and fraud in 2013, but this can be tricky – oftentimes these sites operate on several platforms through social registration, comments, voting/widgets and others. Administrators of sites such as Facebook and Twitter must take all platforms into consideration for their cyber security strategy, it added.

“As more business transactions and activities move online, almost no industry is completely safe from fraud,” said Mr. Baumhof. “The best way for businesses and consumers to stay protected is to put preventative measures in place before it’s too late. While cybersecurity and fraud prevention seems unnecessary for some businesses, cybercriminals are so sophisticated today that they can’t be kept at bay for long without appropriate strategies in place.”

With the advent of the Central Bank of Nigeria’s Cashless Policy earlier in the year, more Nigerians have been obliged to explore other means of payment and money transfers including mobile and online options.

This has however raised more concerns as fraudsters have also diverted to that avenue, sending scam e-mails demanding for ATM PINs from account holders, amongst others.

Banks have continually sent messages to their customers to be alert and on no account should they give out their PINs as the banks would not request for them.

A number of surveys have revealed that risks remains one of the major reasons why a number of people remain unbanked, and why the use of the PoS and online banking and other online transactions remain low as customers fear insecurity of their data, and the fear of losing money.

According to Financial Derivatives Company, a diversified Financial Institution, cash policy and PoS penetration is still below expectations. “90 per cent of transactions are still cash based. 7 per cent are credit card purchases and 3 per cent, cheque payment”.

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