Staying resilient: Fraud Awareness Week 2023

Despite fraud being a longstanding issue, BDO's Forensic Services team has noted a significant increase in fraudulent activity within the current economic climate. This rise is evident in traditional forms, such as invoice and records falsification, employee fraud and third-party fraud, and modern digital online scams.

In the ever-evolving landscape of the digital age, fraud, and associated scam activities continue to pose a growing threat to personal and professional security. Latest data trends suggest the prevalence of fraud continues to grow, which reinforces the need for events such as Fraud Awareness Week.

Avoiding scams is becoming increasingly difficult in the digital age, with businesses and individuals being targeted. Cybersecurity weaknesses in business systems are often exploited, with the resulting theft of proprietary data and intellectual property often high on the hit list.

Where security systems are maintained, staff become the alternative target, with phishing and social engineering attacks becoming increasingly sophisticated. The result is a constant battle for supremacy as organisations try to maintain their integrity and reputation through risk mitigation whilst still finding time to conduct normal business operations.

At the same time, individuals like you and I are continually targeted, both professionally and personally. It is no longer enough to simply battle these risks at work, blending constant security training, controls, systems, and safeguards while trying to do our day job. We also need to maintain that same constant vigilance at home to protect ourselves and our loved ones – particularly those who are vulnerable.

It is crucial to understand the current trends to stay vigilant and protect yourself, your family, and your livelihood from these deceptive practices.

Phishing scams continue to dominate

As of the end of September 2023, the ACCC (Australian Competition and Consumers Commission) Scamwatch statistics reported that Australians have already lost over $397 million from over 234,000 reported instances, with phishing scams topping the list by total number of reported incidents.
Phishing scams involving fake emails, messages, or websites to target individuals at home and work usually aim to trick people into providing sensitive information such as passwords or financial details and they often appear legitimate, mimicking reputable organisations or government agencies.

Trends on the rise

Number two on the ACCC’s Scamwatch list by number of reports is false billing, which targets individuals and businesses alike. Whilst many are monitoring their cyber security systems and on the lookout for phishing scams, unfortunately many businesses do not pick up the quiet change of vendor bank account details or the additional invoice amongst the monthly bills until it’s too late.

Topping the list by the amount lost per scam is investment scams. These scams involve fraudsters exploiting individuals seeking lucrative opportunities by promoting fake investment schemes promising high returns and using tactics like cold calling or online advertisements, often with fake “celebrity endorsements”. Any unsolicited contact that promises exceptional returns should make you wonder why the person is telling you about it and not sitting on a sun-soaked beach in the Bahamas enjoying their “long lost secret to wealth creation!”

In recent years, major public attacks on large corporate entities in Australia have prompted people to take notice of the value of their personal information. It also prompted changes to the Privacy legislation to ensure that corporate businesses pay greater attention to how they identify, collect, store, and dispose of personally identifiable information.
Despite this, many individuals continue to give away highly sensitive information, often on an ongoing basis, in return for a “free” app or service without taking the time to consider the risks involved. Identity theft also remains a persistent threat, with criminals using stolen personal information for various fraudulent activities, with the potential for financial losses, damaged credit scores, and legal consequences for victims. Regularly monitoring bank statements, using strong passwords, and employing identity theft protection services are essential safeguards.

Summary

At BDO Forensic, we are regularly sought out by clients following a cyber incident seeking to understand what happened, exactly how it happened, and the nature and extent of any data breach that may have occurred. With the changes in privacy legislation and the increased regulatory focus on proper data governance, Fraud Awareness Week is a timely reminder for businesses to review and consider their security measures, data controls and staff training and awareness programs.

By adopting secure online practices, conducting thorough research before making financial-related decisions, and maintaining a healthy dose of scepticism, we can reduce the risks of falling victim to deceptive schemes. As technology advances, so do the methods employed by fraudsters, making ongoing awareness and adaptability key components in the ongoing fight against scammers. This is why initiatives such as International Fraud Awareness Week are important reminders to everyone, including seasoned professionals.

Throughout the week, BDO Forensic will share tips on making your organisation more fraud resistant. Keep an eye out for the release of the next update of our Australian Scam Culture Report which also includes further details on the Dark Web activity for the September quarter. Contact our team to find out more about our services.