Firms absorb losses caused by cybercrime - survey

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Cape Town - According to a survey conducted by Kaspersky Lab together with B2B International in 2014, 52 percent of financial companies reimburse customer losses caused by Internet fraud without actually investigating the circumstances.

Almost a third of companies believe the costs incurred by cyber threats are less than the cost of protection. As cybercriminals increasingly target e-payments, this approach could translate into considerable expenses for the company.

Many organisations that work with online payments are prepared to accept the additional costs that arise from cyber-attacks. Twenty-eight percent of the representatives from financial companies and 32 percent of the online store employees polled are sure that the total losses from online crime, including reimbursement of stolen money, do not exceed the costs of deploying security solutions.

Only 19 percent of financial companies and seven percent of online marketplaces cite the cost of compensating customer losses in the top three most serious consequences of cyber fraud.

At the same time, according to Kaspersky Security Network, nearly 4 million users of Kaspersky Lab products encountered financial malware that attempted to steal their money in 2013 (a rise of 18.6 percent compared to the figure for 2012).

In December 2013, a number of North American banks suffered losses of more than $200-million as a result of customers’ bank card details and personal data being leaked – and the final sum of the damage is likely to be much higher.

Obviously, the continued growth in cybercrime will lead to a situation where the compensation paid out by companies will exceed both the cost of protecting financial transactions and their compensation budgets.

“Besides the need for financial companies to set aside funds in their budgets to reimburse money stolen from customers, they also have to cover the costs of dealing with customer complaints. But most importantly, even if the victims are reimbursed quickly, they are likely to think twice about using the services of a bank that can’t ensure their online accounts are secure. It is better to prevent the loss rather than compensate it,” commented Ross Hogan, Global Head of Fraud Prevention Division, Kaspersky Lab.

“Customised solutions designed to protect online transactions such as the Kaspersky Fraud Prevention platform can reduce the risk of online fraud to a minimum, meaning funds set aside for compensation can be freed up and used for developing the business.”

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