What next for Financial Crime?

Jamie and I spent a lunchtime this week listening to a webinar given by the Information Security Forum, a global organisation set up to help companies and their customers defend themselves against financial crime. The focus of the talk was anticipated developments in financial crime. This is an important subject – if you can have an idea of what the criminals are up to, you will have a better chance of defending yourself against them.

Whilst financial crime rarely affects us, fortunately, when it does, it can be devastating. Financial criminals will prey on you when you are vulnerable; we have seen clients succumb when they are ill and when significant life events are happening to them or their family. One of our recommendations is that, if you are feeling stressed for any reason, you should think carefully about any financial transaction you make. If you ever feel uncomfortable about a transaction, do contact us, we’ll be happy to discuss it with you. 

So, what are the criminals planning?

The good news is that traditional financial crime continues to decline. There is not much point in bashing someone over the head and demanding they hand over their cash when they probably aren’t carrying any. There are fewer bank branches to rob, and they don’t hold as much cash as they used to. And compared to online crime, there’s a high chance of being caught.

The bad news is that online financial crime will continue to develop, and criminals are becoming more sophisticated. You may have noticed that the quality of scam emails has improved, so that they are more likely to seem genuine.

More importantly, criminal groups are using information technology in a similar way to legitimate companies. In particular, they are using Artificial Intelligence to profile you, using the data left behind by your digital footprint. The information which you post on social media is being used by criminals to build up a profile of you which they can use subsequently to extract money from your bank account. That harmless-looking quiz to find out which book character you are, has just asked you for your favourite colour and your grandmother’s name. Both classic security questions used to keep various online accounts secure.

Many of us will casually mention our children’s names on social media. We may then celebrate their birthdays with them, and add a photo of the celebration to our social media accounts. Many people’s online banking passwords are made up of a combination of their children’s names and dates of birth; criminals will use Artificial Intelligence to collect this information and then make repeated attempts to access our bank accounts. As more of our data goes online (including our health data), the criminals are able to build up better profiles of who we are.

That doesn’t mean that you shouldn’t happily post about your children’s birthdays on social media; it means that you need to be more careful about setting your passwords and perhaps generating random ones for the most sensitive accounts.

It would appear that criminals will be targeting their activity towards companies and organisations now, particularly now that more of us are working at home. The links in the security fence around our data have been weakened as a result of the move to home working, with data often starting its journey to the office from a home wi-fi system. There are other human weaknesses in the security chain which arise from working from home, which criminals might exploit. It’s even been suggested that criminal exploitation of home workers could result in a pivot back to the office.

Criminals are also using Artificial Intelligence to obtain goods and services that are in limited supply. Like ticket touting for popular concerts, criminals use IT systems to buy something for which there is high demand, and then sell it on for profit. This can be anything – from computer games to COVID vaccination slots. If they can’t sell the product or service on, they can make money in other ways. So, for example, a criminal can use Artificial Intelligence to book up your AirBNB for the next six months; and only release their hold on your asset if a ransom is paid.

The message is to be increasingly vigilant about our data and to apply more thought to the passwords which we use. The good guys have done a lot to improve our defences, and we can help them by thinking twice about passwords and how we access our funds online. Just as importantly, we need to recognise that there are times when we might be stressed, and that this is when we are most likely to make a costly mistake.


Philip Wise | philip@sussexretirement.co.uk

Managing Director and Chartered Financial Planner

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