Online scams and fraud are becoming increasingly sophisticated, making it crucial for individuals and businesses to stay vigilant. In 2024, new scams have emerged that exploit technological advancements and social engineering tactics. Here are some key strategies to avoid falling victim to scams and fraud this year.
Stay Alert: How to Avoid Phishing Scams
Phishing scams are more sophisticated and pervasive than ever, often masquerading as legitimate emails from banks, online stores, or even popular events like concerts and sports. "This year, make sure to watch out for phishing emails pretending to be from your bank, fake online stores, and even scams related to popular events," advises Joe Chappius, finance planner and tax expert at Tax Climate.
One particularly deceptive form of phishing targets shoppers, especially during the holiday season. These emails might appear to be from reputable retailers, offering coveted discounts or alerting you to a problem with your order. However, clicking on the links typically leads to malware being downloaded onto your device. "Double-check the email address to confirm the sender's legitimacy," recommends cybersecurity expert Jane Doe from SecureTech. "Look for poor spelling and grammar, and be wary of any links that ask for your personal information."
To protect yourself, never click on links from unsolicited emails or messages. Instead, type the URL directly into your browser to ensure you’re visiting the correct site, especially for banking or financial transactions. "Always verify that the website is legitimate by checking the URL carefully and looking for secure connections (https://)," says Chappius. If you're unsure about the authenticity of a message, consult with a trusted family member or friend. Remember, staying vigilant and skeptical of deals that seem too good to be true can significantly reduce your risk of falling victim to these scams. "Practicing all of these together will help you reduce your risk of falling victim to these scams," adds Chappius.
Safeguarding Against Deepfake Scams
Fraudulent schemes are becoming increasingly sophisticated, and one alarming trend is the rise of "deepfake" scams. "I’ve managed numerous cases involving fraud and scams, and these events impact both businesses and individuals, constantly evolving with new tactics each year," says Griff Harris, certified insurance counselor and owner of GriffitheHarris.
Deepfake scams use advanced AI to mimic voices and videos, allowing fraudsters to impersonate executives and solicit fraudulent wire transfers or sensitive information. "This type of fraud devastates both a company’s financial standing and reputation," Harris explains. One notable instance involved a company in Hong Kong where €23 million was transferred based on a video call that appeared to include the firm's chief financial officer. The scam was only discovered after the employee checked with the head office, revealing the deception.
To protect against such scams, Harris emphasizes the importance of stringent verification processes. "Implement multi-factor authentication and require a verification call or in-person confirmation for all financial transactions," he advises. Additionally, educating employees about these risks and how to identify red flags is vital. "At my company, we conduct comprehensive training sessions focusing on both traditional and emerging fraud methodologies," Harris adds.
Moreover, investing in the right insurance coverage, such as cyber liability insurance, can help mitigate losses if a scam succeeds. "Through our Personal Risk Management Planning (PRMP) process, we tailor insurance programs that not only fit our clients' specific needs but also anticipate potential risks, including fraud and scams," Harris notes. "This proactive approach has successfully safeguarded many of our clients against potentially crippling financial damages."
Globally, the impact of deepfake scams is growing. In Australia, deepfake videos and AI-generated news stories have promoted fake investment opportunities, costing Australians over $8 million last year, according to the National Anti-Scam Centre. In Europe, deepfake videos imitating BBC presenters surfaced, falsely promoting an Elon Musk investment project.
In the US, the FBI's Internet Crime Complaint Center reported nearly 900,000 complaints last year, marking a 22% increase from the previous year, with potential losses exceeding $12.5 billion. Experts predict a $2 billion annual rise in identity fraud through generative AI, according to Marketwatch.
In the US, the FBI's Internet Crime Complaint Center reported nearly 900,000 complaints last year, marking a 22% increase from the previous year, with potential losses exceeding $12.5 billion. Experts predict a $2 billion annual rise in identity fraud through generative AI, according to Marketwatch.
To avoid falling victim to these sophisticated scams, always verify unexpected requests for money or sensitive information, even if they seem to come from trusted sources. "If in doubt, hang up and call back your contact," advise security experts. By staying vigilant and implementing robust security measures, you can protect yourself and your business from the evolving threat of deepfake scams.
Navigating the Rising Tide of AI-Driven Fraud
"In my extensive work with complex commercial litigation, particularly fraud cases, I've witnessed the ingenuity of fraudulent schemes and their devastating impacts on businesses and individuals alike," notes David Brillant, a tax, trust, and estate lawyer at Brillant Law. One of the emerging trends in 2024 is the rise of sophisticated online scams, notably AI-driven phishing attacks. These scams leverage artificial intelligence to craft highly convincing fake emails and social media messages designed to steal personal and financial information. "From my practice’s experience, a critical strategy to combat these threats involves adopting comprehensive cybersecurity measures," Brillant emphasizes.
Implementing advanced anti-phishing tools and regularly training employees on the latest cyber threats are essential steps. "Enabling two-factor authentication (2FA) on all critical accounts can add an extra layer of security against unauthorized access," Brillant recommends. Additionally, rigorous financial oversight, such as regular audits by external reviewers, can help identify discrepancies indicating internal fraud, like embezzlement. "Maintaining strict controls over financial transactions and approvals acts as a deterrent against internal fraud attempts," Brillant adds.
The financial industry has seen a significant rise in fraud involving deepfakes and machine-learning algorithms. These technologies are increasingly being used to fake identification documents, biometric verification, and data validation. According to Onfido's Identity Fraud Report 2024, improved AI tools are facilitating document manipulation and the use of deepfakes in scams. "Fraudsters are getting creative with biometric fraud, using deepfakes and face-swapping apps," the report states. This trend saw a notable increase between 2022 and 2023.
"Fraudsters often use genuine documents obtained via data leaks for verification checks, then alter their faces for biometric checks," the report details. Although faking biometrics remains relatively rare, accounting for just over 2% of overall fraud attempts, the use of generative AI and deepfake applications is on the rise. The report highlights that a small number of fraudsters are responsible for most deepfake attacks, typically focusing on one business at a time. Unlike previous years, fraud attempts in 2023 were consistently detected every day of the week, indicating global, interconnected activity.
Interestingly, Europe is the least targeted region for these frauds, with average fraud rates at 3.1% for all ID verifications, primarily involving national ID cards. The French national ID card is the most commonly stolen document in such crimes.
"In sum, vigilance, continuous education, and adopting advanced security technologies are fundamental to protecting yourself and your business from the evolving landscape of scams and fraud," concludes Brillant. As fraudsters become more sophisticated, it's crucial for individuals and businesses to stay ahead with proactive and comprehensive security measures.