The chances of becoming a victim of electronic fraud are growing every day for both individuals and businesses.
“We see fraud on a daily basis,” said Frost Bank Senior Vice President Mickey Boland as he introduced a presentation on how to protect your money and your identity in a digital world at the Harlingen Chamber of Commerce. With so many options to conduct financial transactions online and with wireless devices, extra care needs to be taken to circumvent the “hazards of convenience.”
The cost of cybercrime is projected to reach $2 trillion by 2019, an increase of four times over security breaches in 2015, said Frost Bank Vice President Sonia Cano.
Even pulling up to an ATM to withdraw money can be risky because scammers have developed sophisticated tools to steal your money. For example, the plastic cover over the slot where money is dispensed might not be what it appears to be. It could be a fake cover placed over the real one that has a sensor and mini-camera that can steal your debit card information and PIN. The same could go for the receptacle where you insert your card. Self-serve gas pumps can also be attacked with similar devices.
While most banks check their ATM machines frequently for such devices, Cano suggested people might want to try moving those areas on the machine. “If they are a little bit loose you probably don’t want to use that one,” she said.
In the business world, electronic fund transfers are favorite targets of cybercriminals, with many of the scams conducted through hacked email accounts. Once hacked the bad guys can take their time to study emails to track writing styles and schedules. Then they may figure out when an executive is away from the office and mimic that email style to prompt employees to transfer money to bogus accounts.
“Scammers target businesses that regularly perform wire transfers,” Cano said, noting that nearly 75 percent of companies have fallen victim to compromised business emails. “This is a $5 billion scam worldwide and it’s just getting worse and worse.”
Mobile wireless devices can be particularly susceptible to cyber attack, and users should take every precaution possible. Cano said to be careful of using WiFi networks at businesses or hotels, and make sure to verify you are connecting to the right one. “There are bogus WiFis out there just waiting for you to log in so they can steal your information.” She also suggested turning off the WiFi and Bluetooth when not in use.
High-tech theft is a growing problem, but some tried and true low-tech methods are still effective. Traditional check fraud continues to grow at about 2.5 percent a year, Cano said. Each year some 500 million paper checks are forged or altered in the United States.
The list of scams is long and getting longer, but there are ways for consumers to fight back. Banks are willing to consult with customers to help them identify potential problems and implement strategies to fight back. For example, banks can offer text alerts to customers about debit charges or balance levels that could tip them off to potential fraud.
But at the end of the day, Boland said good old-fashioned common sense is still one of the best defenses. “If something doesn’t look right pick up the phone and ask somebody,” he said about suspicious emails or other electronic communications that involve moving money.
Boland recalled a recent example when he spotted a wire transfer for $40,000 made by a customer. Knowing the individual and the business, it set off an alarm in his head. He called the business owner and asked. “What wire transfer? That’s not mine,” was the response.
“This is real-world stuff,” Boland said. “It’s just common sense stuff. Just pick up the phone and ask somebody.”