Want to red card fraudsters? Here’s how to do it during the World Cup and beyond

The 2014 FIFA World Cup has been described as the ‘digital World Cup’. According to Google, the massive rise in mobility and Internet access since the last global tournament is a big contributor. Today, more people use their phones to search for information on players and games and to watch matches. In fact, the amount of football content broadcast on YouTube has increased 900-fold since 2010, showing an increased desire for instant gratification.

This presents an ideal opportunity for online fraudsters. The risk of identity theft and falling victim to scams is gravely heightened during the World Cup as football fans shop online for memorabilia and tickets and access their online banking accounts from unsecured WiFi hotpsots.

And then there’s the dramatic increase in 419 and mule scams.

We’re often warned to be vigilant when it comes to opening suspicious emails that claim we’ve won a competition we never entered. Banks constantly stress that they would never ask for our Internet banking login details over email or SMS. Yet, we still fall victim to these scams — 19% of South African online banking users have been victims of identity theft, up from 10% a year ago, and the economy loses R5.7-billion every year to cybercrime.

But there’s one type of online fraud that doesn’t get enough attention – and that’s the increasing number of people being recruited as illegal money mules.

Much like 419 scams – where fraudsters claim that a long-lost relative you never knew existed has died and left you millions – mule scams are immensely appealing. They promise attractive earning potential for a few hours’ work a week. All the user has to do is allow funds to enter their bank accounts. They keep 10% of the proceeds and forward the balance on to another account. Easy money for easy work. But what the victims don’t know – or do, but choose to take the risk – is that they are aiding and abetting a money-laundering scheme and are facilitating the efforts of international drug and trafficking rings run by sophisticated syndicates.

With the South African unemployment rate at 25.2% and amid a shrinking economy and threats of interest rate increases, it’s understandable that people who are desperate for money and employment would be lured into such a scam.

But stop and ask yourself, if someone approached you in an airport and asked to put a package in your luggage, you’d probably refuse and flag down the nearest security officer. Why is the transfer of illegal money any different? Because it’s easy to find recruits and because cybercriminals are more sophisticated than ever and are continually looking for new avenues to launder illicit funds.

They use state-of-the-art technology to bypass existing fraud systems, which are no longer fit for purpose. They communicate and share information over social networks, blogs and the Deep Web. They engage bank insiders to understand the detection environment. And they use Trojans that run analytics and measure our online banking behaviour.

So how is your bank protecting you? Current security systems have not kept up with online fraud tactics, which change often. Typically, banks have siloed fraud detection systems that focus on single lines of business rather than adopting a holistic, end-to-end solution that gives them a “single view of the customer”. This makes it easy for fraudsters to bypass fraud business rules and predictive models.

Essentially, banks need to fight the highly sophisticated technology fraud threats with advanced analytics. Hybrid, advanced and proactive analytics solutions consider a number of factors when deciding if a transaction is fraudulent. This includes analysing user behaviour, recording incorrect logins and the loading of beneficiaries whose accounts are on a mule watchlist. They consider the customer’s network and are able to pick up if a customer is logging in from a different device, IP address or location from where he typically accesses his accounts.

They also consider the user’s demographics to decide whether he is more at risk of falling victim to online fraud. If a number of flags are raised on a single transaction, the system will automatically block any suspicious activity, which will be escalated for further investigation – before the money leaves the bank account.

Until banks match their technology arsenal to those used by cybercriminals, it’ll be up to you to protect yourself from fraudsters. There’s one cardinal rule: if it seems too good to be true, it probably is. You cannot win a lottery or competition you did not enter. No one is going to simply give you tickets to the World Cup final. Don’t open suspicious emails – it’s highly unlikely that Cristiano Ronaldo is contacting you. And, above all, apply common sense. Why would someone give you a portion of their money to transfer funds to another account when they can just as easily do it themselves?

And consider the consequences if you’re caught. You might get away with pleading ignorance, but amid the repeated warnings out there, you’ll still be subjected to unnecessary law enforcement scrutiny and could possibly end up behind bars.

If you suspect you have fallen victim to a money mule scam, contact your bank immediately – before they adopt advanced analytics to catch you out.

Image: Jonathan via Flickr.