Fraud Week: A Look at the Rise of Cyber Crime

By Zafar I. Anjum

International Fraud Awareness Week kicked off on Sunday, and CRI Group is a proud sponsor once again this year. In observation of Fraud Week, I'd like to spend this blog article talking about a problem that is only getting worse: online fraud.

woman_computer.jpg

In Africa, it is estimated that for every 100 online transactions, seven are fraudulent – a staggering number when extended across millions of transactions all around the continent. Africa is not alone in its fraud troubles, however – other regions are close behind. In Asia, for example, 5 percent of all Web transactions are fraudulent, followed by South America (four percent). Europe and America register two percent and one percent, respectively.

Those statistics, published by global firm iovation, are based on billions of transactions that were analyzed for geographic trends. The study revealed that credit card fraud, identity theft, and account takeover or hijacking attempts were the leading cyber crime schemes in 2012.

In the UK, troubling numbers from the Office for National Statistics (ONS) are raising the alarm at a time when most consumers are looking for any indications that their online business transactions are more, not less, secure.

Unfortunately, they are in for some bad news: The ONS reported (via The Telegraph) that there were more than 230,000 cases in England and Wales in the first half of this year, marking a shocking 59 percent increase over the last five years. This covers all fraud, not just online theft, but experts see a correlation between the increase in online activity and the rise in fraud cases in general. Indeed, a large percentage of fraud reported in the UK today are “purchase frauds,” involving online shopping, as well as spyware and malware, along with credit card fraud.

What is online fraud costing all of us, in global terms? No one can say for sure, but Eugene Kaspersky, the Russian co-founder of anti-virus software maker Kaspersky Labs, says he believes it ranges in the hundreds of billions of (U.S.) dollars. His remarks at a technology conference in Dublin, Ireland, as reported by The Guardian, had him casting doubt on a previous online fraud loss estimate of $100 billion, noting that he thinks it is many times more than that amount.

It will be imperative that government agencies, along with corporations, Internet providers and facilitators, work closely with security firms and cyber crime experts to stem fraud threats, both now and in the future. This Fraud Week, it is important to remember that a big part of the fight against fraud is happening online – and it will take the right combination of expertise, tools, tough laws and strict enforcement to keep our Internet frontier secure.