No matter where you live, scammers will come for you. Whether through phishing emails and text messages or social media, the biggest cyber threat facing banking customers today is the rise of sophisticated social engineering frauds. The UAE Cyber Security Council recently reported that more than 50% of individuals fell victim to a phishing website, and nearly one in five were targeted with a social media scam. There is no escape.
Fraudsters have quite the bag of tricks. They pose as staff from law enforcement authorities, regulatory bodies, judicial authorities, courier agencies, telecom companies, or banks, and they sound so convincing that customers can hardly be blamed for trusting them and following their "advice." They might be calling to get customers to update their records, pay fine/fees/penalty to avoid being arrested, or offer a unique investment plan. This, combined with the use of technology like deep fake videos or audios to mimic the voice of a real person known to the victim, makes these scams almost irresistible.
Additionally, identity theft remains a significant issue, affecting not only individuals but also companies. Fraudsters impersonate employees of reputable companies to apply for facilities from financial institutions.
There is increased scrutiny from regulators, lawmakers, and the media regarding whether financial institutions are doing enough to protect customers against fraud. Stringent requirements exist around KYX (Know Your Stakeholders, including customers, vendors, staff, etc.) and transaction monitoring. In the digital era, finding cost-effective yet reliable methods to conduct continuous due diligence, including during account opening, is crucial.
Counter-fraud professionals and businesses face a challenging task in navigating these choppy waters of fraud, where fraudsters only need to succeed once, but financial institutions cannot afford to miss even once. It’s no more about probability but the impact - financial, reputational, and regulatory consequences, not to mention the time lost by senior executives when frauds occur.
I will be speaking at the upcoming BioCatch Threat Talk Live on November 6, 2024, in Dubai. Join us in exploring the existing and emerging frauds impacting the Middle East region and potential solutions to combat the problem.
I hope to see you there!
