Johannesburg – Online fraud has been identified by 79 percent of organisations across Europe, the Middle East and Africa as a growing challenge to be faced over the next five years, according to a new report launched by Experian, a global information services company.
“Fraud is becoming more complex with the challenges of multi-channel customer engagement, increased regulations and cross-border activity,” Michelle Beetar, Experian South Africa managing director, said.
“The rapid rise in demand for online banking, combined with very little security on devices means there are huge opportunities for cyber criminals, leaving many people and businesses exposed and extremely vulnerable,” she said.
The study, Experian Decisioning Vision 2020 (DV2020) EMEA, analysed findings from 255 key decision-makers from 195 telecoms and financial services organisations in eight regions across Europe, the Middle East and Africa (EMEA).
Experian found that many organisations were struggling to reach a balance between stringent fraud control and satisfying user experience. Three in four organisations saw fraud integration across internal systems as an issue that urgently needed addressing now, while nearly four in five believed it would still be a major issue in five years’ time.
“Over 90 percent of South African organisations stated that protecting the business whilst ensuring a good customer experience would be their biggest future challenge. Indeed, 92 percent of respondents reported that they were held back from tackling fraud because of fears of impacting the customer experience.”
Experian partnered up with fraud expert Frank Abagnale, one of the world’s most respected authorities in the field, and bestselling author of ‘Catch Me if You Can’, on an anti-fraud campaign to raise awareness about risks in the business environment, and to advise on their fraud prevention systems.
“Experian would present their solutions to me, and I would pick holes in them until they made them secure,” explained Abagnale, the man whose life story, ‘Catch Me if You Can” provided the inspiration for Steven Spielberg’s feature film of the same name.
Before Abagnale’s 19th birthday, he had successfully impersonated an airline pilot, a doctor and a lawyer, and made millions of dollars forging checks.
“The detection and prevention of cyber-fraud are vital for South African credit providers and the local financial services industry in general. In the last 10 years the trend in cybercrime has moved away from individual perpetrators and towards the rise of powerful and sophisticated cartels. As these cybercriminals increasingly organise themselves, so must their targets,” says Beetar.
The theft, distribution and sale of personal information were underway on an industrial scale never seen before. Beetar said South Africa was the second most targeted country in the world for internet fraud and phishing attack.
She noted that the explosion in the demand for and use of hand-held devices meant that having suitably compatible anti-fraud technology had become absolutely critical.
Abagnale added: “On the flipside, technology and data are also at the heart of fraud prevention. Proficient fraud detection depends upon the methodical ability to accumulate and quickly evaluate large amounts of data, while identifying activities and patterns symptomatic of potential fraud, to prevent and reduce fraud losses.”
Beetar said that as consumers increasingly used their devices to conduct transactions, businesses needed to recognise their good customers and keep them protected from cyber-criminals. Since devices were able to be checked invisibly in the background, higher security could be achieved through advanced device authentication software. “This gives businesses and their customers the best of both worlds and makes device recognition the fraud team’s new best friend,” said Beetar.
“Our results demonstrate that protecting the customer relationship is significantly impacting organisations’ ability to tackle fraud. However, if businesses make the right investments in process automation, system integration, and authentication, a comprehensive strategy to fight fraud can be achieved without sacrificing the customer experience,” she said.
Abagnale pointed out that if you were on Facebook and wrote where you lived and when you were born, you were already putting yourself at a 90% chance of your identity being stolen.
“I always tell people not to post pictures of themselves straight on because there are applications that can allow someone to access your Facebook page in seven and a half seconds,” he said. “Rather post pictures of yourself with other people or while doing activities.”
ANA