As fraudsters continue to adapt and develop new techniques, it becomes increasingly challenging for those of us in the public sector to stay ahead. In order to help you mitigate these risks, some of the top experts in counter fraud share their insights on the most probable fraud threats in the upcoming year.The recurring theme, when asked about the biggest fraud threats for the next 12 months, was the prevalence of technology-enabled fraud, and the susceptibility of new technologies to exploitation by fraudsters:
"I read recently that $2 billion worth of cryptocurrency was stolen last year through social engineering and a lack of knowledge on behalf of the owners. This is a great example of criminals exploiting innovative, niche subjects that not many people truly understand - and these are the sorts of threats that I think we need to keep an eye on, for example , for example AI and new proof-of-identity technologies etc.
As these technologies come into play I think we need to fraud-proof them as we go and as they come in, not after they're established."
"We're seeing more and more links to traditional organised crime – for example groups that were previously involved in drug importation etc. are now linked to fraud. And that brings its own threats and difficulties for us and emphasises the importance of [the SFO] working with our partner agencies such as NCA, police forces etc."
“This year, we're looking at green crime and the green economy - how the narrative in investment fraud, for example, is using the green initiative to lure people in. Looking further ahead, I think it's important to look at the Metaverse, and where money and currency will be placed and used more dynamically in the future.”
"The main five threats we focus on - what we call the “highest harm” threats – are investment fraud; romance fraud; payment diversion fraud - also called business e-mail compromise; courier fraud - someone impersonating a police officer / someone from the bank and coming to your door; and computer software related fraud - someone pretending to be from Microsoft, for example, and trying to get access to your computer.
But as we look at these fraud types we are definitely seeing an evolution of the threat, where we're seeing ever greater use of technology. We're seeing more cyber enabled crime i.e. there's a hacker that's stolen some data, and that data is used by a fraudster to carry out their crime, and a lot more of what I would call 'technology enabled fraud'.
As a recent example - fraudsters were using a service called ‘Ice booth’, which enabled them to pretend to be somebody else. So when they called up the victim they were able to use a number which suggested they were from a bank. And that tooling enabled hundreds, if not thousands of criminals, to in turn target thousands of victims. It's fraud on an industrial scale.
And that that sort of evolution of threat is something which is very challenging but also it means within the response we definitely need to bring together more coherently the sort of cyber capabilities we have, and the and fraud response capabilities.
So, what we're trying to do at the NECC is to is to go after the technology as well as the criminals, to have a strategic impact."
Public sector organisations need to be aware of these most likely fraud risks in the next 12 months and start fraud-proofing as new technologies emerge. By incorporating them into your fraud plans, for example, and collaborating with other government departments and local authorities you should be able to spend more time preventing fraud, rather than detecting and chasing the funds after the fact.
To get suggestions on how to mitigate these fraud threats, listen to the rest of the interviews, live on Fraud Focus - the monthly videocast hosted by Mark Cheeseman OBE of the Public Sector Counter Fraud Authority. Season 1 is free to watch here >> https://info.govnet.co.uk/fraud-focus-season-1