The fraud landscape is constantly evolving. To keep a pulse on the current state of fraud, our Trust and Safety Architects at Sift share their insights on emerging online fraud trends and effective risk prevention. From shocking dark web research to industry-leading insights, discover the latest fraud-related news in our Digital Trust & Safety Roundup.
Sift celebrates World Password Day
In honor of World Password Day on May 5th, Kevin Lee, VP of Trust and Safety at Sift, shares his perspective on the future of account-based security.
“Legacy account security approaches, like passwords, and knowledge-based authentication, are no longer enough to effectively verify users and consistently defend against fraudulent logins. Customers should be free to permanently ‘forget’ their passwords. If a business can’t grant that freedom, customers may take their business elsewhere.
As we look into the future of account-based security on World Password Day, companies need an intelligent approach that verifies users, secures accounts, and stops [account takeover (ATO)]. Through passwordless authentication solutions, trust and safety teams can have forward-looking security protocols that address businesses’ account security needs and stop ATOs in their tracks.”
Read more on the VM Blog and learn how Sift is paving the way for the future of account security.
The rise of fraud-as-a-service
Due to recent dark web marketplace crackdowns, fraudsters are turning to new under-the-radar platforms, like Telegram, to carry out their illicit activities. Through encrypted messaging apps, they’re able to profit by advertising their scams as fraud-as-a-service schemes. Recently, these scammers have started targeting the prosperous buy now, pay later (BNPL) sector, selling user credentials and dead credit card information to leverage against BNPL providers that don’t collect the first installment payment.
“Over the last couple of years, we’ve seen fraudsters come out of the shadows of the dark web to advertise fraud-as-a-service in publicly available forums on messaging apps, like Telegram,” Allen says. “Now anyone with a smartphone can ask a willing cybercriminal to buy them anything from meals to airline tickets for a fraction of their actual costs.”
Read more in the San Francisco Examiner.
“The only way to get ahead of these scams is for BNPL vendors to ensure they have the right defense strategy in place to combat fraud on their own platforms and networks,” said Brittany Allen, Trust and Safety Architect at Sift. “The challenge is that vendors are dealing with a rapid increase in transaction volume, so the ability to scale their fraud prevention efforts is critical.”
Discover more insights in TechCrunch.
Fraudsters are hungry for food delivery scams
Reports of elaborate restaurant-related scams have exploded during the pandemic, burning restaurants, delivery apps, and consumers in the process. More recent schemes show scammers are targeting businesses and consumers through food delivery apps, offering free food or deep discounts thanks to stolen personal information and payment data.
“With fraudsters stuck at home but still needing to eat lunch and dinner, that just went off and through the roof,” said Allen. “And it’s continuing to go because fraudsters have found that it’s a successful business for them and they are actually able to make money off of using these accounts and being able to send food out to anyone who is willing to pay them a little bit of Bitcoin or Ethereum.
They will also post pictures where others or people who received the food will brag about having gotten this food for basically no money or even for free in some cases. We’ve seen rooms full of pizza, we’ve seen tables stacked with fried chicken or Chinese take-out, entire boxes of donuts, pretty much whatever people want, it’s all open and all fair game.”
Read more in the Detroit Free Press and NBC Boston.
Cryptocurrency is under fire
Cryptocurrency has quickly become a popular way of building wealth for consumers and fraudsters alike. Allen provides insight and perspective on how the recent SEC regulations and DOJ crypto bust underscore the urgency for proactive fraud prevention.
“With cryptocurrency threats on the rise, the SEC’s regulations are welcome, but these preliminary regulations will only act as a baseline to protect businesses and consumers. Crypto companies must go beyond regulations to proactively invest the right resources to prevent a growing volume of hacks and fend off fraudulent behavior.”
Learn more about how regulations are impacting the crypto industry in PaymentsJournal.
Romance scams meet crypto cons
Romance scams and cryptocurrency cons make for a dangerous duo. Pig Butchering scams have Jane Lee, Trust and Safety Architect at Sift, explaining how this scam has become so prevalent and why it’s so concerning.
“People are lonely, looking to dating apps, looking to meet and connect with people. And then the other side of the coin is cryptocurrency is such a hot topic right now.”
And the fake crypto trading platform is shockingly believable. “It’s a website they have full control over and it mimics whatever the price of Bitcoin is at the time. They are using real-time value so, if you were to cross-check just to verify, it looks real and so that’s the added twist to this particular scam.”
Read more about Pig Butchering scams in Bloomberg and Metro.co.uk, or check out the most recent episode of Sift’s Digital Trust & Safety Insider podcast.
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