Financial Cybercrime: What Is It and How Can We Prevent It?

Financial Cybercrime: What Is It and How Can We Prevent It?
Post Menu and Details.

Words: 777

Reading time: ~3 minutes

The advance in technology has allowed the automation and digitization of financial systems, however, it has also brought sophisticated electronic crimes along with it. For years now, financial cybercrime has been on the rise, and it is expected to continue increasing. Currently, there are thousands of cybercrime attacks being committed each day, resulting in billions of confidential records being exposed.

Anyone could fall victim to financial cybercrime – but what motivates these attacks, and how can we protect ourselves from them?

What Is Financial Cybercrime?

Cybercrime in finance is a profit-driven criminal activity where one party illegally obtains financial gain through an attack on another party. In other words, financial cybercrime includes activities such as identity fraud, extortion, stealing payment card details, email or SMS fraud, and ransomware attacks.

The industry of financial services is, of course, a lucrative target, which means they are heavily impacted by the increase in financial cybercrime activity. Nonetheless, any and all companies could be attacked, as could any unsuspecting individual just like you or me.

Unfortunately, nowadays, most people will have received a dodgy email or text claiming to be something it is not. Often, technology can automatically regard these alerts as spam. However, cybercrime criminals are getting harder and harder to detect.

What Types of Financial Cybercrime Attacks are There?

As stated above, many cybercrime emails and texts are easy to spot and not well rehearsed. For example, you have been alerted of the death of a foreign relative you’ve never heard about, of whom you are the sole heir and in line for money.

In order to receive this money, you will likely be asked to give out personal information or send money through Western Union for some obscure reason. Needless to say, doing so leads to a slippery slope, and any such suspicious activity should be blocked immediately.

Cybercrime criminals have greatly advanced their plots and can disguise themselves as; your bank, HMRC, the government, tax rebates, insurance companies, Netflix, Spotify, and much more. These types of cybercrime manipulation could be telling you it’s time to pay your monthly invoice or that you’re due money back. In order to do this, you will be directed to a link or asked to provide confidential information.

Some of the most common financial crimes committed on companies and individuals are listed below;

  • Fraud
  • Money laundering
  • Terrorist funding
  • Identity theft
  • Bribery/corruption
  • Insider dealing
  • Dating site scams
  • Personal data breaches
  • Bank account theft
  • Ransomware attacks
  • Extortion
  • Bitcoin scams

Who Commits Financial Crime?

Who Commits Financial Crime?

Those who commit financial crimes can often be grouped into seven categories;

  • Corrupt heads of state in power
  • A company’s customers, suppliers, or contractors
  • Business leaders or senior executives
  • Various employees from senior positions to junior positions
  • Organized criminals, including terrorist groups
  • External fraudsters colluding with a company’s employee/s
  • Lastly, individual criminals, including serial or opportunist fraudsters

As you can see, these categories cover a broad spectrum of people. Meaning it’s possible for anyone, anywhere to commit a financial cybercrime.

What Are the Consequences of Cybercrime?

Successful attacks can leave behind dramatic and devastating consequences. Large sums of lost money could impact the entire economy of a company or even leave them bankrupt, especially for smaller businesses. Aside from financially, affected companies will suffer from reputational damage in the eyes of clients, stakeholders, and the general public.

As for individual victims, their whole life could be turned upside down by having their banks emptied or racking up debt in their name after having their identities stolen. This will have a knockoff effect on their jobs, mortgages/bills, and mental health.

What Can We Do to Prevent Financial Cybercrime?

With such frequent cybercrime attacks, we should familiarise ourselves with initiatives to prevent them. Often, human error is what allows exploits to happen, so training and awareness are imperative.

As a company, employees must be equipped with relative knowledge of how they could be tricked into financial cybercrime and what to do if it occurs. Aside from this, it is essential to have high-functioning threat intelligence in place with regular checks carried out. Maintaining good cyber hygiene may also make it harder for criminals to target a company.

As for individuals, here are some ways that you can protect yourself against financial cybercrime;

  • Always make payments and transactions through official sites
  • Do not click on any suspicious links and always verify the sender’s identity
  • To prevent being hacked, use strong passwords and change them frequently
  • Only use trusted public Wifi – this is a hackers haven
  • Keep your software up to date with firewalls and virus blockers
  • Only make online payments to trusted companies and individuals
  • Use two-factor authentication

Final Thoughts

To find out more about financial cybercrime and further educate yourself on the subject, visit the NICE Actimize website, which offers real-time, cross-channel fraud prevention.

Thank you for reading!