Social media is the golden goose for fraudsters and scammers – Fact or Hearsay?
An everyday respite for people, social media (SM) is interspersed with their daily lives, be it for entertainment, work, or even for following the news. Some users turn to SM for investment decisions, while for most corporates SM is the core of their digital strategies. While such platforms can be very useful for users, they can also be a minefield for cybercrimes. Fraudsters have also been swift at targeting new technologies, and SM is no exception.
The many faces of Social Media fraud
Due to its pervasive reach and ease of use, SM is the preferred medium to connect people across all age groups, nationalities, or cultures and is now a global phenomenon. It is also a key source of information for organizations that use it to study their customer’s preferences. However, this immense exposure of sensitive information across various SM platforms can give way to unbridled risks. Scammers lurk in the shadows of such platforms silently stalking SM profiles and creating fake personas to bait users with malicious scams such as investment fraud, catfishing, phishing attacks, and many more.
A recent report by Federal Trade Commission (FTC) states that about 95,000 people reported losing $ 770 Mn to fraud stemming from SM platforms in 2021, a shocking increase from the $ 42 Mn reported in 2017. This demonstrates the stealthy growth of scamsters along with the modern technological evolution. Organizations dependent on SM reviews/online user interactions such as Amazon, Flipkart, Facebook, Instagram, and YouTube, are breeding grounds for frauds such as identity theft, credit card fraud, chargeback scam, or false return scam. As per a 2022 survey by Statista, loss due to cybercrime has been estimated at a staggering $ 2.4 Bn worldwide. This includes SM-related frauds such as personal data theft, identity theft, or smishing of SM accounts, amounting to $ 877 Mn. How to combat this rampant deceit?
Battling Social Media fraud to stem revenue leakage
To address such frauds and scams, SM platforms must establish a sophisticated and hard-coded fraud monitoring and detection system. This will safeguard people’s digital profile and while keeping a stern lookout for malicious entities round the clock.
Enter advanced behavioral analytics and stringent customer/ viewer profiling that could aid in fortifying SM platforms and capturing the perpetrators. Traces of online presence such as virtual signatures, biometrics, fingerprints, and online transaction history of every profile creates a digital identity. A centralized, secure fraud management solution with the power to screen and blacklist false digital identities after thorough KYC verification is the need of the hour.
Any organization with an active SM presence can be a victim of vicious cyberattacks. According to a study by Parachute, an IT consultancy firm, 34% of organizations worldwide were involved in cyber incidents in 2021, out of which 27% fell prey to ransomware attacks resulting in a revenue loss of $20 Bn. Lack of sturdy cyber security measures and awareness are the major causes of concern for organizations, directly contributing to cyber frauds and ransom attacks. A modern revenue assurance and fraud management (RAFM) system that leverages the power of Artificial Intelligence (AI) and Machine learning (ML) algorithms to provide safe, secure, and automated risk management is the solution. In the current technological landscape, which is flooded by data, such solutions develop predictive trends that can foster sound strategic planning. Such systems are empowered to track anomalies during their continuous data analysis and generate preventative automated alerts to flag suspicious activity.
Spending time on SM platforms is now a routine activity for the global population. This provides ample opportunities for fraudsters to take undue advantage of innocent users while hiding their malicious intentions behind the veil of anonymity. Thankfully, the technology that has enabled these perpetrators has also paved the path to capture them. Fraud management systems that undertake behavioral analytics and account profiling are helping organizations prevent revenue leakage. Remember, SM is not all about offense and can be the biggest ammunition in your defense strategy as well.