$2.1 trillion. That will be the size of the cybercrime problem by 2019, according to a study by Juniper Research. Unless it happens sooner, a distinct possibility given the explosion of cybercrime in 2015 and the all-out entry of organised crime into the field. If the organised fraudsters continue at the same pace they worked in 2015, we’re likely to reach those staggering losses even earlier than 2019.
And another study, sponsored by IBM Security and conducted by the Ponemon Institute painted a grim picture as well. The “2015 Cost of Data Breach Study” showed that the average cost of a data breach, based on data from 350 companies spanning 11 countries, had increased by 23% in just two years, up to $3.8 million per breach. Drilling down further, they found that the average cost for each lost or stolen record increased 6%, to $154. The losses don’t stop there, either, as the report notes. Potentially, the greatest losses can come from lost business, as consumers become increasingly aware of breaches and increasingly leery of exposing themselves to risk.
No matter how you count it, it adds up to huge losses, many of them avoidable when businesses take the right steps at the right time.
Today, Cybercrime Is Organised crime
While organised crime’s dominance in cybercrime is not a new development by any means, 2015 was marked by a major acceleration of “Mob” activity, experts say. The Lone Wolf hacker hasn’t gone away, of course, but the lion’s share of the cyber loot taken now falls into the hands of highly sophisticated organised cyber gangs, big businesses in their own right and “organised like start-up companies.” according to IBM.
Think of “The Godfather” or of modern day drug cartels. Dress them up and give them a staff of skilled developers steeped in the intricacies of malware and attack tactics and you have a picture of some of the world’s most successful fraudsters in this day and age.
What Thief Doesn’t Love An Unlocked Door?
As the losses continue to grow right along with the sophistication of the cybercriminals, business executives are increasingly looking at IT security as a major business risk that requires aggressive, cutting-edge solutions.
For many, that means adopting a robust and comprehensive fraud detection system such as NICE Actimize’s solutions for fraud and cybercrime management, designed to prevent and detect both traditional fraud and the newest modes of cybercrime.
The 6 Weak Spots
As the business world has been learning, every business innovation can also be a welcome new opportunity for fraudsters. Just consider some of the most vulnerable areas:
1. In many ways, the financial industry continues to be at the forefront of the digital revolution, with each technological advance representing both new business opportunities and new conveniences for customers. But the more channels available, the more chances for fraudsters to slip in with their own new approaches to digital banking fraud.
2. Payment fraud is a pervasive threat in banking today, and one that is growing and changing at an alarming rate, affecting not only retail banking but extending throughout business lines, including private banking and commercial banking.
3. Card and emerging payment fraud offers would-be criminals yet another opportunity to cause harm, both through established products such as credit, debit, and ATM cards and relatively new vehicles like mobile wallets and prepaid cards.
4. Check fraud is not among the newer challenges, but with more ways to deposit checks and pressure from customers to expedite processing, criminals are finding new ways to game the clearing cycle.
5. Internal threats, too, are as old as banking, but the complexities of modern banking processes and continuous technological change can confound efforts to detect and prevent fraud, collusion and damaging non-compliant activity.
6. Contact centre fraud is yet another costly and rapidly growing business of choice for fraudsters and a formidable challenge for managers working to minimise the risk, without reliance on systems that complicate legitimate transactions and inconvenience valued customers.
Staying A Step Ahead Of The Fraudsters
Even in the face of all these threats, however, there’s still good news when it comes to cybercrime mitigation. In many ways, fraud detection and prevention can be more efficient and effective today than ever before, when a state-of-the-art fraud detection system is implemented. Each of the vulnerabilities enumerated above can be addressed with unified, elegant solutions that balance the urgent need to thwart fraud with the equally pressing need to safeguard the customer experience in the process.
With cybercrime prevention experts unanimous in predicting that fraud can be expected to grow exponentially in years to come, those competing pressures won’t go away anytime soon.