Online fraud off the charts during 2020

Online Fraud

This year has been filled with a plethora of cyberattacks targeting businesses, governments, and individuals across the board, as they take on different shapes and forms, spanning a multitude of industries and sectors.

According to U.S.-based software company Arkose Labs, almost 1.1 billion cyber-attacks were detected and halted during 2020 so far, which represent double the attack volume compared to the second half of 2019 and a 25 person attack rate increase across all transactions.

“The digital commerce landscape has fundamentally changed in 2020 due to the COVID-19 pandemic. With digital transactions surging, businesses are operating under intense pressure and incentive levels for fraudsters are sky high,” said Vanita Pandey, VP of Strategy at Arkose Labs.

Pandey added that fraudsters have been quick to identify how consumers’ digital behavior is evolving and are adapting their attack targets and tactics accordingly.

The rise of online fraud can be attributed to a myriad of disruptions that happened this year.

Let’s jump right in.

The havoc of the COVID-19 pandemic

The pandemic has drastically changed our behavior in all things, be it in real life or online. Thus, hackers have taken advantage of this sudden shift in behavior to exploit them for possible theft opportunities.

Cybercriminals have approached the pandemic with a large deceptive tool kit to work with. They have targeted acts such as stealing stimulus checks and unemployment benefits, setting up fake landing pages for charity donations, and even going as far as tricking people into pre-ordering COVID-19 treatments and bogus vaccines.

Q1 of 2020 saw a barrage of bot attacks, representing 74 percent of all attacks. This happened as fraudsters acted quickly to ramp up attacks when global lockdowns were introduced, forcing more consumers online, according to the report by Arkose Labs.

Surge in online shopping

While most of us remain indoors, the majority of people have shifted their focus toward purchasing their groceries and other products via e-commerce platforms such as Amazon, Alibaba, and other boutique e-shops.

This has opened the virtual flood gates for potential fraudulent transactions to happen; some criminals create and operate fraudulent websites posing as genuine online retailers. These can be difficult to distinguish from the real thing.

Criminals sometimes pose as buyers on auction sites, sending spoof emails as proof of payment transfer to the genuine seller. The payment fails to materialize, but the goods have already been sent.

Rise of Fintech

Fintech is rapidly changing the payment industry, as more customers are switching to them rather than traditional means. Fintech companies that provide these payment services are subject to heightened fraud risk as the emerging global environment reacts to COVID-19.

The reason for this is due to the increase in online payment processing/volume which may cause operational concerns in monitoring and detecting fraudulent transactions.

Other reasons are due to the changing norm in work environments, as working remotely increase potential cybersecurity risks – issuing remote access to a broader employee base such as contractors and/or vendors. Another is caused by a reliance on outsourcing to third-party service providers who may require additional fraud monitoring and oversight.

Skyrocketing tech scene

With the fifth generation of mobile networks slowly starting to rollout across the world, many technologies are also upping their game to remain relevant within the ever-changing technological tide.

Everything from artificial intelligence (AI), to Internet of Things (IoT) powered devices, to augmented reality (AR), and virtual reality (VR). As these technologies make strides in changing how we live our day-to-day lives, so too do the means of manipulating them for malicious use.

Cybercriminals are integrating these new emerging technologies to stay ahead of the curve and deliver more sophisticated ways to worm their way into any piece of tech being developed.

As time passes by, technology will be integrated into the very fabric of our society at a much grander scale, allowing us to be connected to each other more so than ever; but lurking in the shadows are those who look to exploit that tech for their own malicious acts.

This not only elevates the importance of cybersecurity, but cements its high level of priority for businesses, governments, and individuals across the board to protect themselves from the attacks looming within the cyber shadows.