Are Financial Companies Protecting Your Personal Data?

Are Financial Companies Protecting Your Personal Data?

by | Dec 28, 2022 | Breach, Identity Theft

Are financial companies protecting your personal data from Identity Theft and Fraud?

In July, I read that “cumulative merchant losses to online payment fraud globally between 2023 and 2027 will exceed $343 billion,” according to Juniper Research.

Online payment fraud includes losses such as those from digital sales, physical goods, banking transactions, and peer-to-peer payment apps.

I also read a November Consumer Affairs article titled “Scammers are using Facebook Marketplace, Zelle, and PayPal to snare new victims,” where “scammers are impersonating recognized businesses like Amazon, Apple, and other name-brand companies to appear reputable to their target, to then run off with their personal or financial information.”

Consumer Affairs reported, “the top 5 scams were bank/credit card (10.3%), debt/loan (6.6%), and free money (6.4%).”

According to Jim Luff, Corporate Communications Manager at Aurora Payments (a leading payment service and solutions provider), Aurora sent a March 2022 message to its merchants where Aurora Payments explained how the chargeback process is often used to commit fraud by claiming merchandise was not received, misrepresented or the result of “friendly fraud.”

In friendly fraud, online orders are placed by someone known to the cardholder, such as a child using a parent’s credit card without their knowledge. Aurora Payments shares detailed information about chargeback fraud in their merchant message, “The Great Chargeback Surge of 2022. 

Consumer Affairs also reported that “many of the scams target consumers who use peer-to-peer payment services and other platforms connecting users directly to one another” and that “scammers were also “lurking” on P2P cash transfer apps Zelle (86%) and PayPal (31.8%).”

Fortunately, according to this November New York Times article titled “Banks Plan to Start Reimbursing Some Victims of Zelle Scams,” the seven banks that own Zelle (Bank of America, Capital One, JPMorgan Chase, PNC, Truist, U.S. Bank, and Wells Fargo) will now compensate customers who fall victim to certain kinds of Zelle related scams, including fake bank fraud texts, emails, and phone calls.

Which leads me to…

All of the above leads me to the Money20/20 USA Fintech Conference that I attended in October.  It’s the largest global fintech event connecting the payments industry, including issuers (e.g., banks and credit unions providing debit, credit, or prepaid cards to consumers) and payment processors (e.g., Stripe, PayPal, or Square), along with payment networks such as American Express, Mastercard, and Visa.

During the conference, I picked up a copy of The State of Fraud and Financial Crime in the U.S., a survey of 200 financial institutions with assets of at least $5 billion. The surveyed executives held leadership positions in fraud and risk operations, money laundering, fraud strategy, fraud management, and technology and data science.

According to the survey, sponsored by PYMNTS, 62% of financial institutions reported an increase in financial crime year over year. Additional survey highlights included the following:

  • The average cost of scams to each financial institution was $102 million.
  • Fraud rates and losses increased for nearly all payment types in 2021.
  • Smaller financial institutions are getting attacked the most.
  • Authorized and unauthorized fraud types currently appear to be relatively equal, but scams are on the rise within authorized fraud.
  • Criminal approaches are becoming more sophisticated, and most financial institutions consider this to be a problem.

What does all this mean? It means that while consumers are big targets for identity theft, fraud, and scams, financial institutions are bigger targets.

So back to the title of this article: are Are financial companies doing enough to protect your personal data from Identity Theft and Fraud? My answer is threefold: 
  1. First, and based on my experience at the Money 20/20 Conference, I believe the payments processing industry is doing a good job managing fraud prevention to help make payment transactions safer for both consumers and businesses.
  2. Second, Zelle’s proposed rule change for early next year requiring the network’s member banks to compensate customers who fall victim to certain kinds of scams is very positive.
  3. Finally, based on the reality of bad actors such as nation states, cyber thieves, and identity theft criminals, the financial services industry will continue to be heavily targeted by identity thieves due to a large consumer account base and the significant amount of personal data these institutions collect and store.

by Mark Pribish

Practice Leader, Identity Theft, and Data Breach Services

43% of Breaches Affect Small Businesses
Why Provide Identity Theft Protection as an Employee Benefit?

 

 

Holiday Travel Fraud is Here

Holiday Travel Fraud is Here

by | Dec 19, 2022 | General, Identity Theft

A favorite holiday tradition is visiting family while on the road. But we must be careful not to reveal our identities to everyone as we go about spreading holiday cheer. Holiday travel fraud is here and there are some things you should do to prepare.

Because of all the holiday commotion, gift givers, shoppers, and travelers can be a treasure trove for identity thieves who know you might be letting your guard down. If you’re anything like me, you struggle to stay within your budget; however, don’t give the bad guys access to every aspect of your life and finances.

Here are a few things to keep in mind before you crack open the eggnog!

  • Put your mail on hold; arrange to have all important documents delivered electronically. Additionally, contact the post office to have your mail held.
  • Social media: This one is hard!  We all want to share our fun with the world, naturally.  You also tell the world when you are not at home and how long you will be gone.
  • Check your credit cards and bank accounts. Keep track of the charges and amounts on your accounts and credit cards. You can also set up alerts to let you know when certain spending or account limits are met.
  • Clean out our wallet:  Remove all but the necessary forms of payment from our wallet. It is simpler to remember which cards you have and quicker to limit your exposure if your purse or wallet is stolen.
  • Public WiFi:  open access WiFi is never a good idea, period.  Open WiFi while on vacation is a bad idea because it is exactly the environment the bad guys are looking to exploit.  We strongly suggest using a VPN while on any network that is not yours! Read more here: Public WiFi is Putting You at Risk
  • Use hotel safes: Place anything that has personal information on it that you don’t need in the room safe. This way, it isn’t on your person and reduces the risk of it being lost.
  • Protect your phone: It seems like we should not have to say this, but if you do not have a password or biometrics on your phone, set them up before you go.

We can’t guarantee that doing this will stop identity theft while traveling or at other times. However, we can affirm that these are always excellent habits to adopt. Do what you can to lessen your chances of experiencing identity theft while traveling for the holidays.

Related Articles:

 

4 Things to Watch Out for this Holiday Season!

4 Things to Watch Out for this Holiday Season!

by | Dec 14, 2022 | Identity Theft, Uncategorized

4 Things to Watch Out for this Holiday Season!

Oh, what a year it has been and continues to be this holiday season!  Unfortunately, in this continued craziness, bad guys tend to take advantage of anyone they can.  They also are opportunistic during the holidays.  Both being an issue right now provides a great opportunity for deceit and fraud.  We encourage you to take the time this year to ensure you are being safe with your generosity and activities online and off.  Below you will find 4 things to watch out for this holiday season, coupled with the pandemic.

  1. Online shopping Scams!

    This year more than ever, holiday shoppers will
    be purchasing online. According to the Better Business Bureau, online
    shopping is expected to increase over the last year by 10% to 75%. Watch out
    for “locked out” messages claiming you have been locked out of your
    accounts. The bad guys are sending phishing emails in an attempt to
    steal your account information.

  2. Charitable Giving Scams.

    Giving scams are always increased around the
    holidays but due to more families needing help in 2020, it is likely that there
    is a large increase in donations and scams. COVID scams are going to
    continue and the holidays are a great way for criminals to take advantage of
    your giving spirit. Make sure you are giving to a reputable organization.

  3. Use Secure Payments Use your credit card online, it has more protection
    than your debit card.

    Credit cards have better dispute protections where
    debit cards can expose your bank accounts to withdrawals. Use Credit cards
    for transactions, they provide more protection if you have made a
    transaction with a criminal.

  4. Ads and Offers Scams.

    You will see many ads and offers on platforms like
    Facebook and Instagram this holiday season. Before you purchase through
    an ad or offer, research the company for anything scam-related
    “Peace of Mind with a Place to Turn”

These 4 things to watch out for this holiday season are just some of the scams out there.  Please take care in your efforts to spread holiday cheer and think before you click.  We wish you the happiest of holidays!

Here are some additional articles you may find interesting:

Gift Card Fraud During the Holidays

Gift Card Fraud During the Holidays

by | Dec 8, 2022 | Breach, Identity Theft

Gift card fraud rises during the holidays every year. So many of us love buying and using gift cards as gifts. They are practical, simple to purchase, simple to use, and simple to give as gifts. They typically let the recipient choose exactly what they want, and they are frequently given as rewards for actions.

According to estimates, the market for gift cards is worth hundreds of BILLIONS of dollars. Nobody dislikes receiving a free gift card, right? BUT, gift cards are unfortunately frequently used by con artists to defraud their victims of money.

There are many ways gift cards can be used by scammers, here are the top three, as noted by KnowBe4:

You Have to Use Gift Cards to Pay a Bill

One very typical scam involves a potential victim being contacted by someone, usually via voice call (although it can also be done via text message or email), and being informed that either their regular payment to a reliable service has been declined or that there is a new emergency charge. A good illustration of the former is when a con artist calls pretending to be the victim’s electric company. They will claim that the victim’s regular electricity payment was rejected and that unless they visit a store and pay the bill with gift cards, their electricity will be turned off in a matter of hours. Who would use gift cards to pay their electricity bill? You would be shocked. A who’s who of medical professionals, attorneys, and even law enforcement. People who previously thought they were too savvy to get scammed are often on the victim list.

A good illustration of the latter scam is when a caller pretends to be from the IRS or law enforcement and informs the victim that they owe an unpaid fine and that they will be arrested if they don’t pay right away. Who would think that the police or the IRS would take gift cards as payment for a fine? Once more, a higher proportion than you might guess.

How can you avoid this scam?

There is a very high chance that a request for an emergency payment is fraudulent, especially if it involves gift cards. If the caller is willing to provide their contact information, you can take it. If you ask them for their contact information, they typically hang up the phone immediately. In either case, get in touch with the company. Using a known phone number or email address and inquire about how to confirm the request’s legitimacy. The legitimate company will put you in touch with their billing department so you can confirm the request and pay the bill if it is genuine.

Gift Cards That Have Been Maliciously Modified in Stores

In this scheme, thieves steal department store gift cards, discover their personal PIN numbers, and then put them back on the shelves where a victim will find them. The fraudster can frequently spend the value of the gift card faster than the victim when the victim purchases the previously tampered with card and activates it. To find out when the gift card is activated and how much money is still on it, the fraudster can repeatedly call the store’s gift card number.

How can you avoid this scam?

When you purchase a gift card, check to see if it has been tampered with in any way. Choose gift cards from the bottom of the stack; this is not foolproof but may help. Most major retailers who use gift cards are aware of these scams, and many will you to guard against them. Some of them may even offer to reimburse you if you lose money.

“Win a free gift Card!”

This is a huge scam, particularly during the holidays. It’s a common gimmick to offer “Win a free $100 Amazon Gift Card!” Either you are required to download and run a file to “transfer” the gift card to you, or they will request personally identifiable information from you, such as your social security number or bank account information. There are thousands of legitimate circumstances where anyone can win a free gift card, which makes this particular phishing scam effective.

These scams can be easy to recognize because, despite the fact that they purport to be from a well-known, reputable company, the gift card URL, phone number, or email address is not from that company. Instead, they appear at random in emails or texts. But, again, this can be challenging because many trustworthy businesses hire outside contractors to handle their real free gift card distribution. It’s possible that the URLs, phone numbers, and email addresses you see don’t correspond to the actual, legitimate vendors.

When the offer is simply too good to be true, it more than likely is.

There are tons Gift Card Frauds During the Holidays. It’s typically a scam if someone contacts you and demands that you use a gift card to pay a bill. Simply ignore them if you can’t positively, unquestionably confirm that the gift card reward or request is legitimate or that a card hasn’t been tampered with. A $100 gift card is not worth the risk of losing your bank account and personal information.

Here is some guidance from the FTC regarding gift card fraud.

Related Articles:
Criminals Love the Holidays

Criminals Love the Holidays

by | Nov 29, 2022 | General, Identity Theft

It is such an exciting time of year with holiday parties, buying presents for your favorite people, and enjoying family! But it is also important to keep in mind that online shoppers and the holidays are two things that cybercriminals enjoy during this exciting time. Because Criminals Love the Holidays!

It is wise to keep in mind that websites can be compromised or even spoofed at this time. There are already fake shipping notifications, fake holiday contests, and phishing and vishing scams out there looking for your information.

Threats during the holiday season should serve as a reminder of two crucial life lessons:
  1. Your private information is not as private as you might believe.
  2. and cyber thieves do not take the holidays off; in fact, they turn up the volume!
Below are 5 things to consider while you are out spreading holiday cheer!
  • Deal with businesses you know and trust.
    And use a credit card instead of a debit card or checking account. We are often told to use debit for budgeting purposes, which makes sense, BUT your credit card is safer as it is protected under the Fair Credit Billing Act. It is far easier to recover funds from a stolen credit card than it is from a debit or bank account.
  • Watch out for fake website domains; they can easily fool you.
    Make sure you are on the correct retailer’s website while shopping.  Beware of “domain squatting” sites with an added hyphen or a misspelled or incorrect URL. These tricks can be easily overlooked.
  • Scams like phishing and vishing
    Pay attention to emails requesting personal information from retailers, the Internal Revenue Service, and financial institutions. No reputable business or government organization will contact you by phone or email and ask for your personal information.
  • Fraudulent shipping alerts and notifications
    Phishing emails are sent out by scammers and contain links that could allow unauthorized access to your personal data or download malware onto your device.
  • Holiday contests
    Holiday contests are a great way for retailers to support branding and marketing. Fake contests are a great way for fraudsters to collect your personal information and install malware. Double check URLs to ensure they are truly connected to the company they say they are. When in doubt, don’t fill it out!

In short, think before you click, and if it seems too good to be true, it probably is.

Most importantly, cyber thieves love the holidays, but you can continue to love them too—just be careful!

 

BONUS:
Top 5 Personal Privacy Tips
  • Security software: regularly update the security software (antivirus, firewall, and anti-malware) on your devices.
  • Password management: Always create complex passwords using a combination of mixed-case letters, numbers, punctuation, and symbols with a minimum of 20 characters—typically an easy-to-remember sentence.
  • Privacy settings: understanding how your information is stored and used Read the privacy settings of the apps and social media sites you frequent.
  • Use multi-factor authentication to provide additional information beyond a login or password.
  • E-mails and attachments: To reduce your exposure, do not open e-mails and attachments from individuals or organizations that you do not know and trust.

 

Read more at this FBI Common Holiday Scams link.
Other holiday tips: 4 things to watch out for this holiday season!

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