IDentity Theft and the Criminal Environment
Forged Document Detection as a Central Loss Prevention Strategy
As highlighted in last week's...
International Law Enforcement Takes-Down a “Top 10” Site
There has been extraordinary media “buzz” over the last few years about social networking and the impact it will have on our business and personal lives. Almost every major business magazine and newspaper has featured articles predicting that networking & social interaction sites like Twitter and Facebook would fundamentally alter how businesses “meet” their customers, and how individuals evaluate companies and products.
It should be no great surprise to learn that some of the early-adaptors of such collaborative sharing sites and social networking applications have been the criminal “forger” community. We wrote several years ago about grade school children – many as young as 10 or 11 years old - learning how to counterfeit money and sharing files with each other across the country so that they could create their own “counterfeit factories” at home with their computers. Several such “rings” were discovered around the country. All of this was achieved via their FaceBook or MySpace pages.
However, it was quite a shock to learn of the depth and breadth to which this medium has been capitalized by the criminal community. In January of this year, a joint Secret Service, SOCA and FBI operation took down the “orchestrator” of Dark Market, an online marketplace where fraudsters bought and sold personal data and fake identities. Membership was strictly by invitation. But once vetted, Dark Market’s 2,000 vendors and buyers traded everything from credit card details, obtained through hacking, phishing and ATM skimming devices, to viruses with which buyers could extort money by threatening company websites. It offered online tutorials in account takeovers, credit card deception and money laundering. Equipment – including false ATM and pin machines and everything needed to set up a credit card factory – was available.
It even featured breaking-news-style updates on the latest compromised counterfeit material available, while criminals could buy banner advertisements to promote their wares. So vast was its reach, with members in the UK, Canada, US, Russia, Turkey, Germany and France, the UK's Serious Organised Crime Agency (Soca), which helped bust it, said it was "impossible" to put a figure on how much it cost banks worldwide. "This was one of the top 10 sites in the world, but there are more than 100 we know of globally, and another 100 we don't yet know of," said investigators involved in the case.
As fraud grows to a $1 Trillion problem, annually, the involvement of organized crime and the utilization of modern business technology grows with it. What does this mean to business owners and loss prevention managers? Just as it is necessary to protect your IT infrastructure from intrusion by “layering” concentric levels of security on your networks (firewall, anti-spyware, anti-malware, intrusion monitoring, etc.), so is it necessary to install layers of “fraud security” on your points of transaction. Since the bulk of losses experienced through credit card fraud, check fraud, counterfeit currency and Identity Theft are borne by the merchant, the positive effect of securing the transaction against fraud can have a significant affect on operational profits.