What is mortgage fraud? Mortgage fraud is a serious crime that involves the intentional misrepresentation or omission of information on a mortgage application. This deceit is aimed at securing a larger loan than would be allowed under truthful circumstances, benefiting either the borrower or lender. Mortgage fraud can disrupt the financial system, lead to significant financial losses, and, in many cases, result in legal consequences for those involved. Types of mortgage fraud : Income fraud : Borrowers lie about their income, often inflating it, to qualify for larger loans. Appraisal fraud : Appraisers or other individuals inflate or deflate property values to sway loan decisions. Occupancy fraud : Borrowers claim they will occupy the property as their primary residence to secure better terms, even though they plan to rent or sell it. Identity theft : Fraudsters use stolen identities to apply for mortgages, leaving the victim responsible for the debt. Straw buyer scheme : An indivi...

Organizations often prioritize security against external threats like hackers and malware. However, a more insidious danger lurks within: insider threats . These threats arise from malicious or negligent actions by employees, contractors, or other individuals with authorized access to an organization's sensitive data. Types of insider threats: Malicious intent: Espionage: Deliberately stealing sensitive information for personal gain or to benefit a competitor. Sabotage: Intentionally disrupting or damaging critical systems and data. Fraud: Embezzlement, financial fraud, and identity theft. Negligence: Accidental data breaches: Unintentional sharing of confidential information via email, cloud storage, or social media. Poor security practices: Failing to follow security protocols, such as using weak passwords, leaving devices unattended, or ignoring security warnings. Human error: Mistakes such as misconfigurations, accidental deletions, or data entry errors. Why are insider t...

Auto insurance fraud is a serious issue that affects both insurance companies and policyholders. It involves deceptive practices aimed at obtaining financial gain from insurance policies. It is any act committed with the intent to obtain an improper payment from an insurer. Common types of auto insurance scam includes: False Claims: Policyholders may file claims for accidents that never occurred or inflate the extent of damage. Staged Accidents: Fraudsters deliberately cause accidents to claim insurance money. Application Fraud: Providing false information on insurance applications to obtain lower premiums. Phantom Passengers: Claiming injuries for passengers who were not actually in the vehicle during an accident. Exaggerated Claims: Overstating the cost of repairs or medical expenses. Ghost Vehicles: Claiming insurance for a vehicle that doesn't exist or is not owned by the claimant. Consequences of auto insurance fraud: Increased Premiums: Fraudulent claims lead to higher insura...

In the world of live events, ticket scalping has become a significant issue, affecting both genuine fans and the event industry as a whole. What is ticket scalping? Ticket scalping refers to the practice of purchasing tickets for events such as concerts, sports games, and theater shows and then reselling them at a higher price. This practice often results in genuine fans missing out on tickets or having to pay inflated prices. How it works? It involves the rapid purchase of tickets as soon as they are released. Scalpers use automated tools known as bots to bypass purchasing limits and secure large quantities of tickets. These tickets are then sold on secondary markets at remarkably higher prices, exploiting the high demand for popular events. Types of scalper bots: Spinner bots: These bots are designed to refresh ticketing websites repeatedly until tickets become available. They can quickly complete the purchase process, often faster than a human can. Harvest bots: These bots collect...

Chargeback insurance is a type of coverage designed to protect businesses from the financial impact of chargebacks. A chargeback occurs when a customer disputes a transaction and the funds are returned to them by their bank or credit card company. This can be a costly issue for merchants, as they not only lose the sale but may also incur additional fees. How chargeback insurance works? When a customer disputes a transaction, the merchant's bank reviews the claim. If the dispute is deemed valid, the bank reverses the transaction, returning the funds to the customer. Chargeback insurance helps mitigate this risk by reimbursing the merchant for the lost revenue and associated fees. Essentially, it acts as a safety net, ensuring that businesses are not left financially vulnerable due to chargeback disputes. What chargeback insurance covers? Disputed transactions: Covers the cost of transactions that are reversed due to customer disputes. Fraudulent charges: Provides reimbursement for t...

Brand impersonation has emerged as an alarming threat in the digital age. It not only deteriorates the reputation of well-established brands but also misleads genuine customers. How does it work? Brand impersonation involves creating fake websites, emails, social media profiles, and even physical products that closely mimic those of a reputable brand. The primary goal is to deceive consumers into believing they are interacting with the legitimate brand, often to steal personal information, money, or to distribute malware. These attacks exploit the trust that consumers place in well-known brands, making them highly effective. Methods of brand impersonation attacks: Phishing emails: Attackers send emails that appear to be from a legitimate brand, often asking recipients to click on a link or download an attachment, leading to data theft or malware infection. Spoofed websites: Creating websites that look almost identical to the brand’s official site. These sites are used to collect login ...

Invoice fraud poses significant risks to businesses of all sizes. It involves deceitful tactics to manipulate the invoicing process for financial gain, leading to monetary and reputational damage. How invoice fraud works ? Invoice fraud typically involves the creation or manipulation of invoices to deceive an organization into making unwarranted payments. Fraudsters can operate both internally and externally, exploiting weaknesses in the company's financial controls. Common methods include: Fake invoices: Fraudsters create fake invoices for goods or services that were never delivered or rendered. Overcharging: Legitimate invoices are altered to reflect inflated amounts. Phishing and spoofing: Fraudsters pose as legitimate vendors or employees, sending fraudulent invoices via email. Double billing: Submitting the same invoice more than once to receive multiple payments. Impact of invoice fraud Financial loss: Direct monetary losses from fraudulent payments can be substantial. Reputa...

Money mules play a vital role in the world of financial crime. These individuals or groups are instrumental in money laundering operations, enabling criminals to disguise the origins of illegally obtained funds. What are money mules? Money mules are individuals who, knowingly or unknowingly, transfer illegally obtained money on behalf of others. They serve as intermediaries, moving money between bank accounts to obscure its source and destination. Often, mules are recruited through various tactics such as job advertisements, romance scams, or promises of easy money. Types of mule accounts: Witting Mules: These individuals are fully aware of their involvement in criminal activities. They actively participate in the money laundering process in exchange for a cut of the illicit funds. Unwitting Mules: These individuals are unaware that they are part of a money laundering scheme. They might be misled by fake job offers or manipulated by criminals through online relationships. Complicit Mul...

Social media platforms are among the top websites and apps for account takeover fraud reported by consumers as per the Q3 2024 Digital Trust Index report from Sift What is Social media account takeover?  This fraud occurs when fraudsters gain unauthorized access to a user's social media account. Once inside, they can impersonate the account holder, steal personal information, send out phishing messages, and scam the account holder's contacts. How Does It Happen? Credential theft: Fraudsters often use phishing schemes to trick users into revealing their login credentials. This can be done through deceptive emails, fake websites, or malicious links. Password reuse: Many people use the same password across multiple accounts. If a cybercriminal obtains a password from one compromised account, they can use it to access other accounts, including social media. Weak passwords: Simple and easy-to-guess passwords make it easier for fraudsters to break into accounts. Social engineering: ...

The data below demonstrate how important it is for businesses to prioritize and fortify their defenses against bot attacks. Simple bots are still a challenge for businesses across the world. A study from DataDome tested 14000+ popular domains and found that 65% of websites are unprotected against simple bot attacks while around 95% of advanced bots go undetected on websites. Ecommerce, health and luxury industries are among the least protected by bot threats. Recently, ecommerce organizations are concerned of  web scraper bots. These bots scrape all the public data and content from a website. Along with AI , they can not only collect data, but also extract and process it. Akamai researchers have found that 65% of bot traffic on ecommerce sites were from the malicious bots. Bot mitigation report from Kasada  observed that 98% of companies attacked by bots in the last year lost revenue as a result. 57% of companies are increasingly concerned of AI driven threats resulting in com...

  Website or domain spoofing is a cybercrime where scammers create a fake website that mimics a legitimate one to steal personal information, such as usernames, passwords, and credit card details. Why is a website/domain spoofed? Scammers spoof websites to: Steal personal information: Gain access to sensitive data like login credentials and financial information. Install malware: Trick users into downloading malicious software. Conduct phishing attacks: Use fake websites to deceive users into providing sensitive information. Ad fraud: Mislead advertisers into paying for ads on fake websites. How to identify a spoofed website? Check the URL: Look for misspellings, unusual domain extensions or design flaws. Look for security indicators: Ensure the website uses HTTPS and has a padlock icon in the address bar. Examine the design: Poor grammar, low-quality images, and inconsistent branding can be red flags. Verify site seals: Click on site seals to see if they lead to legitimate verifi...

A traditional phishing attack is a social engineering tactic which is used to steal confidential information via emails, direct messages, dubious websites. AI has now increased their impact by making these attacks appear more authentic and difficult to detect. Fraudsters are using large language models like ChatGPT to include real time information and create a sense of urgency for victims to act in the phishing emails. There have been cases of fake ChatGPT apps, that deploy phishing campaigns upon download to steal users' information. Phishing websites were also found to spread malware using name and images from OpenAI. Spear phishing attacks are targeted towards specific user or organization with information obtained from social media. With sophisticated GenAI, spear phishing emails can be written easily and are more likely to trick the recipients.  Vishing (voice phishing) and  deepfakes are other types of phishing that can target victims by using GenAI to clone voice ...

TransUnion's report on H2 2024 fraud trends emphasizes the severity of data breaches in the US, which have reached historic levels in the first half of 2024. Healthcare, financial services, and education are among the industries with the highest volume of breaches. Healthcare also had the most significant breach, with criminals targeting third-party service providers like payroll services, medical billing vendors as a source for multiple user credentials. Contrary to healthcare, financial services were mostly exposed to primary data breach which is a direct attack on the organization. Top confidentiality data compromised in the US data breaches H1 2024 includes name, social security number (SIN), date of birth, home address, medical history,  driver's license, banking account numbers, phone numbers, healthcare provider & insurance account number. Substantial year-over-year increase has been observed in the breach of medical history data, healthcare provider and healthcare...

GRC combines governance, risk management, and compliance in one coordinated model to align IT with business goals while managing risks and meeting all industry and government regulations. Following are the key steps in implementing GRC: Define what matters : Identify silos and set goals to include current processes. Senior leaders play a vital role in understanding the benefits of GRC-driven policies and encouraging acceptance within the organization. Identify risks : Develop a risk-aware culture by identifying the type of risks your organization faces like financial, security, legal, strategic, reputational. Design a plan : Once you determine the goals and have a clear picture of regulations and risk, you can then plan and choose the right GRC framework and tools. At this point, you should define how success will be measured. Test the GRC system : Use a phased approach to start with organization's priorities, focusing on key processes, then expanding the program. Starting small w...

Returns fraud is when a customer manipulates the retailer’s return policy to gain undeserved financial benefit. Stats from the National Retail Federation demonstrated that merchants lost a total of $101 billion due to return abuse and fraud in 2023. Additionally, for every $100 in returned items, businesses lose $13.70 due to return fraud. As retailers prepare for this year's Black Friday, focus is on implementing ways to reduce the losses from returns. An emerging trend is " refunds as a service ", where consumers are paying cybercriminals to make fake refund claims on their behalf in exchange for a cut of the sales. According to Loop's survey findings, challenges faced by retailers in addressing returns fraud or policy abuse includes maintaining a good customer experience, accurately determining a fraudulent customer, proactively detecting fraud, reducing time spent on manual fraud identification and spike in operating costs. Sellers are combating returns fraud us...

Study from Experian's 2024 Identity & Fraud Report finds that identity theft and stolen credit card information are the top online fraud concerns. In 2024, US consumers are primarily worried of phishing emails, phone scams, false information/ fake news & ads. From businesses perspective, over 50% of them have observed higher losses as compared to previous years. Operational challenges include generative AI (GenAI) fraud and/or deep fakes, P2P payment scams, identity theft, transaction fraud. Account takeover fraud has been consistently topping the list of most reported fraud event by US businesses, followed by identity theft and fraudulent new account openings.  Consumers and businesses are equally concerned about fraud, but there is a decrease in the willingness to share their personal data with the businesses online. Businesses will need to continue combating fraudulent activities by implementing comprehensive fraud prevention strategies to prevent all types of fraud.

APP fraud happens when people are duped into making payments to fraudsters, believing they are undertaking genuine transactions. It relies on the fraudster's ability to manipulate confidence and create urgency through advanced social engineering techniques. Impersonation scam is where the fraudsters impersonate trusted entities to manipulate victims into transferring funds under false premise to acquire their account information, assets, etc. Key strategies to combat APP fraud includes: Using advanced fraud detection system to detect malicious fraud attempts. Educating customers on recognizing the potential scams and protecting themselves. Implementing transaction monitoring to identify risky activities on a real-time basis. Account takeover fraud is a forerunner to APP fraud. With ATO prevention solution, it is possible to prevent bad actors from fraudulent activities. Impose additional transaction checks with time delays for high-value or unusual transactions.

Criminal attacks on online retailers have increased dramatically since the COVID era. AI technologies are becoming highly scalable to empower fraudsters to heavily automate their sophisticated attacks and overwhelm rules-based prevention systems. Signifiyd's "State of Fraud and Abuse 2024" study indicated that efforts to place fraudulent orders climbed 19% in the first half of 2024 compared to the previous year. Recent report posted by Juniper Research, a Hampshire, UK-based consultancy predicts the value of e-commerce fraud to rise from $44.3 billion in 2024 to $107 billion in 2029 – a 141% increase. According to the author Thomas Wilson's statement , “eCommerce merchants must seek to integrate fraud prevention systems that offer AI capabilities to quickly identify emerging tactics. This will prove especially important in developed markets, where larger merchants are at higher risk of being targeted for fraud, such as testing stolen credit cards.” Merchants are adv...