Criminals are seizing on the heightened levels of uncertainty and anxiety prevalent as a result of the global epidemic in increasingly sophisticated schemes. Individuals are targeted by email, text, phone and social media by posing as genuine organisations including government, banks and health care providers in an attempt to get victims to disclose personal or financial information.
The Banking and Payments Federation Ireland (BPFI) FraudSMART campaign recently advised consumers to take extra care when asked to make certain payment requests and keep safe their access credentials. Details published by the BPFI indicate that in the first half of 2019, card fraud reached €12 million. Fraudsters have been targeting the most vulnerable in this crisis, by posing as officials from the Department of Social Welfare, seeking account information from those made recently unemployed.
Several email phishing schemes are in operation claiming to to be from the US Centre for Disease Control and Prevention (CDC) and World Health Organisation (WHO), so never has there been a greater need to be vigilant regarding the issue of hacking and malware.
What types of fraud are businesses susceptible to?
Recently the Irish police force, An Gárda Síochána, has highlighted three main modes of fraud which individuals and businesses are most susceptible to at present:
Phishing involves a company or individual receiving unsolicited contact from someone claiming to be a legitimate organisation. In recent times these communications have contained attachments claiming to contain information on COVID-19.
The communication can also ask people to enter email login details to access the information. This can result in malware infecting your device. According to the UK's National Fraud Intelligence Bureau (NFIB) there have been 105 reports of COVID-19 related phishing attempts since 1 February 2020, with total losses reaching nearly £970,000.
Always look carefully at the address from which the email has been dispatched. Oftentimes phishing emails seek to mimick ‘real’ addresses, but make minor changes that can be overlooked.
Never give out your bank account details or bank information to an unverified source.
Always call before transferring money to confirm the request is in fact real.
Never click on a so called ‘link’ or open attachments from an unknown sender.
Fraudulent selling / trading
Individuals claim to be selling in-demand medical supplies or other goods which may be in short supply.
Individuals try and sell these items online and do not deliver upon payment.
On 19 March 2020, the European Anti-Fraud Office (OLAF) opened a case in relation to the imports of fake products used in the fight against the COVID-19 infection, such as masks, medical devices, disinfectants, sanitisers and test kits. OLAF reports that there are instances of counterfeit face masks being sold online at prices between €5-10 each.
If an offer seems to be too good to be true, then it probably is.
Verify the seller by searching for their name online. Several fora have been established to list known criminals who engage in this type of fraud.
Social engineering scams
Criminals can attempt to exploit an individual or company’s charitable nature on either social media or in person soliciting donations for fake charities.
Always verify the cause to which you are offering assistance by independent means.
How can businesses protect themselves from potential fraudsters?
- Make necessary enquiries and obtain independent advice
- Do not provide personal information about yourself or your company or agree to send money until you are satisfied that the company you are dealing with is genuine
- Purchase only from legitimate vendors and be wary of rushed offers
- Check the Central Bank Registers or do a simple google search to verify the firm is authorised
- Check the charity is regulated by the Charities Regulator or again use google
- Do not click on links unless you are sure they are safe. If a proposed offer looks too good to be true, it’s probably a scam
Continued AML and ABC requirements
Despite the continuing fallout from COVID-19, the legal and regulatory framework governing business has not changed. Businesses must continue to be cognisant of their anti-money laundering and anti-bribery and corruption requirements. The most recent CSO figures released in March 2020, show that reported cases of fraud and related offences increased by more than 25% to almost 8,000 on 2019. This amounts to more than 20 per day.
The increase in reporting will ultimately result in increasing resources being applied to the investigation and prosecution of these offences.
The COVID-19 global epidemic has caused us all to rely more on technology and online activities. Employees across the world are now all working remotely and there is increased reliance on technology to ensure business continuity. Interpol has issued a recent warning advising consumers to be extra vigilant in their purchases, but also to business in the way they use their technology. Interpol says it has assisted in over 30 COVID-19-related fraud cases with ties to Asia and Europe and has frozen 18 bank accounts and more than $730,000 of suspected fraudulent transactions. On 4 April 2020, the President of the Financial Action Task Force (FATF) advised that it was imperative to be wary of Covid-19 related financial crime by remaining vigilant. Now is not a time for complacency.
It is likely that we will see an increase in fraudulent activities as the Covid-19 crisis continues. Ensure that you independently verify the seller of online goods, or consult a person seeking a bank transfer, even if it’s coming from your boss. If you suspect suspicious activity, report it to An Gárda Síochána immediately and inform your bank if it relates to financial activity.
The lessons that we will learn during this crisis will ultimately lead us to clamping down on fraudsters and the anxieties on which they prey at a time when people are most vulnerable. Authorities are watching closely reported fraudulent activity and in time, we hope that this new world of remote work, shopping and engagement will become a safer and more secure one.
Our Investigations & White Collar Crime team has vast experience working with companies, charities and individuals in resolving cyber and financial fraud. We have worked closely with law enforcement authorities here and overseas in assisting our clients have data and funds returned to them.
The content of this article is provided for information purposes only and does not constitute legal or other advice.