Fraud Prevention Month Recap: Watch Out for These Scams

Every month should be treated like fraud month

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At Whistleblower Security, we treat every month like it's international fraud prevention month by deploying industry-leading integrated risk management solutions.

 Fraud and data theft pose a constant threat to the financial health of multinational corporations, government organizations and individual consumers.

According to a recent survey of over 5,000 companies in 99 countries, 47% of the respondents experienced at least one incident of fraud. On average, companies were hit with three fraudulent attacks each year, and 13% of the victims lost more than US$50 million to corporate fraud schemes.

And how much did all that fraudulent activity cost the affected companies? A staggering US$42 billion. During fraud prevention month, USA consumers will lose over a quarter billion dollars to fraud schemes involving everything from fake lotteries to mobile services.

Here are some of the most recent scams targeting individuals and companies, and simple ways to prevent fraud-related losses:

Imposter Scams

Imposter scams continue to rank among the most common fraud-related incidents targeting both corporate and consumer victims. Imposter scams have surged during the COVID-19 pandemic, thanks to the mass adoption of virtual transactions for everything from banking to health care services. Many transactions that were previously done in-person are now conducted online, paving the way for tech-savvy criminals to exploit unsuspecting victims.

This type of scam can be executed in a number of ways, including through door-to-door solicitations, over the phone, by mail or through SMS/text, email or social media. Imposters are skilled in impersonating otherwise trustworthy individuals, such as medical professionals, government employees, company representatives and even friends and relatives, an approach often referred to as an 'authority figure' scam.

Imposter scams might involve:

  • Someone calling from a bank to ask for help with an investigation involving financial crimes
  • An individual claiming they are calling from the IRS or CRA
  • A charitable organization requesting a donation
  • An SMS message that the recipient has received a bank transfer
  • A door-to-door caller claiming they work for the local utility company
  • An email that looks like it comes from a hospital or other health care provider
  • The use of a fake phone number that makes it look like the call is coming from a trusted caller - remember, caller ID can be faked
  • So-called 'granny scams' where a scammer builds a trusting relationship with an elderly target, then works to alienate their target in order to execute financial fraud

Imposter Scam Warning Signs

Imposter scams can be difficult to detect, particularly since the COVID-19 pandemic has eliminated many in-person interactions. Here are some of the warning signs to watch for in Canada:

  • Calls from phone numbers that are very similar to the recipient's number
  • Demands for immediate payments from callers claiming to work for the IRS or another government agency
  • An urgent call from someone claiming to be a family member who says they need cash to pay emergency medical bills or post bail
  • Email or SMS messages with inline links asking recipients to reset their passwords or update their credit card information
  • Requests for payments using cryptocurrency, gift cards or wire transfers
  • Messages saying the recipient needs to send money in order to receive a lottery prize

E-Commerce Scams

E-commerce sales surged in 2021 as many brick-and-mortar retailers were either shuttered, required to comply with government-mandated capacity restrictions, or faced labor shortages during the ongoing COVID-19 pandemic.

According to the U.S. Department of Commerce, 2021 Q4 e-commerce sales in the U.S. rose by 9.2% over 2020 figures, and that's a trend that's expected to continue in the foreseeable future. In 2021, the global e-commerce market had an estimated value of US$4.9 trillion, and that number is projected to grow by 50% to reach US$7.4 trillion by 2025.

The most common e-commerce scams include pagejacking, a scam in which hackers create a fraudulent web page. These fraudulent web pages look exactly like the legitimate website owned by the company the scammers are impersonating. Hackers then collect user data through a fake login page, and use that login information to defraud their victims.

Another growing e-commerce scam is pop-up websites selling in-demand products at rock-bottom prices. The scam often involves a promise of free overnight delivery in order to lure as many victims as possible. Orders through the site are never fulfilled, and in many cases, the websites are taken down within a few days, making it impossible to contact the seller for a refund.

E-Commerce Scam Warning Signs

Some of the signs of e-commerce scams include:

  • Websites without contact information for the business, such as a physical address
  • Newly-launched e-commerce sites selling high-demand products at exceptionally low prices
  • Unsecured e-commerce sites with URLs starting with 'http' instead of 'https'
  • Websites with forged 'trust seals' from online security providers — these seals should always be linked to the provider's website
  • The use of 'scareware' including pop-ups warning that an e-commerce site isn't safe, and that users need to click a link immediately to protect their information
  • E-commerce websites that request extra personal information during the checkout process which could be used to hack passwords. This info could include where the consumer attended school, the name of their family pet, or their mother's maiden name

How Can Whistleblower Security Help?

We're always working to help protect consumers and businesses against scams and fraudulent claims with initiatives like our ethics hotline. Once fraud prevention month has passed, we'll continue to support proven fraud prevention tools, compliance solutions and secure data migration and integration solutions.

Contact Whistleblower Security today to learn more about our innovative 24/7/265 multilingual global ethics hotlines, centralized analytics solutions and case management systems.

Contact us and let's have a chat!

Sources:

https://www.pwc.com/gx/en/services/forensics/economic-crime-survey.html
https://www.ftc.gov/news-events/news/press-releases/2021/02/new-data-shows-ftc-received-22-million-fraud-reports-consumers-2020
https://consumer.gov/scams-identity-theft/imposter-scams#:~:text=In%20an%20imposter%20scam%2C%20a,gift%20card%20or%20wire%20money
https://consumer.ftc.gov/consumer-alerts/2020/10/how-spot-avoid-report-imposter-scams
https://www.usa.gov/common-scams-frauds
https://www.fbi.gov/scams-and-safety/common-scams-and-crimes
https://consumer.ftc.gov/features/scam-alerts
https://techcrunch.com/2022/01/27/ftc-u-s-consumers-lost-770-million-in-social-media-scams-in-2021-up-18x-from-2017/
https://fraud.org/top-ten-scams-2021/
https://www.statista.com/statistics/379046/worldwide-retail-e-commerce-sales/
https://www.census.gov/retail/mrts/www/data/pdf/ec_current.pdf
https://www.fbi.gov/investigate/white-collar-crime

photo Amanda Nieweler
About the Author
Amanda writes for WhistleBlower Security about ethics, compliance, workplace culture, and whistleblower hotlines. Amanda brings her nearly two decades of risk and compliance experience to the WBS blog where she is dedicated to helping people and companies promote speak-up cultures.