Back To The Blog

What You Need to Know About Cyber Fraud

Cybersecurity State of the Market / March 08 , 2022

A changing digital landscape leads to new threats

As a recent Dark Reading article detailed, fraud in digital transactions has worsened in recent times and experts foretell that this type of criminal activity has far from peaked. The current prediction is that by 2025, cyber fraud could be responsible for up to $206 billion in losses, according to Juniper Research. Indeed, KPMG reports that 67 percent of senior risk executives say their companies have been hit with external fraud in the past year alone.

“The cyber insurance community that NetDiligence® supports strives to make their customers ultra-aware about cybersecurity and risk exposures related to cyber fraud that seems to morph on a regular basis,” says NetDiligence President Mark Greisiger. “This especially includes ransomware and business email compromise (BEC) threats, which represent a large percentage of claim losses. Insurers also like to suggest the actionable safeguard controls increasingly needed to maintain comprehensive cyber insurance.”

What is driving the increase of cyber fraud?

The causes of cyber fraud are manifold. Since the earliest wave of the COVID-19 pandemic, people are online more, working remotely from home, doing much more shopping on e-tail sites and using digital transactions.

It’s not just eCommerce fraud, though. Criminals are increasingly targeting the gaming and travel and leisure sectors and experts have already seen theft in the world of the metaverse. Romance-based fraud—committed by so-called Tinder Swindlers—is also on the rise. Even the widespread adoption of touchless QR codes has wrought a new form of cyber scams.

On top of that, threat actors have adopted ever-more sophisticated social engineering techniques such as phishing and fake social media accounts for capturing data, even at times spoofing mobile applications. The Identity Theft Resource Center reports that in the U.S., there were a record 1,862 publicly leaked data compromises in 2021, victimizing nearly 294 million people across all sectors.

A specific area of concern is the widespread adoption of ”buy now, pay later” plans that qualify individuals instantly, using less stringent personal identification criteria than other financial institutions. The lack of controls make it easier for criminals to use fake identities or even “synthetic” identities that combine real and fake information.

How do I defend against cyber fraud?

To make matters worse, many financial institutions have traditionally siloed financial fraud and cybersecurity—leaving wide gaps for criminals to exploit. As Financial Times recently noted, companies simply cannot afford to leave these issues up to the IT department alone as scams and fraud present a serious threat to the company’s operations, reputation and financial health.

“Step one for any organization that wants to improve loss control, compliance and cyber insurability posture is to demonstrate that you have an actionable incident response plan,” Greisiger says, “A plan that goes beyond traditional disaster recovery planning and is accessible, for example, when your network goes down at 11 p.m. on a Saturday night. That plan should also include prevention best practices, including the cyber claims report protocols of your insurer, and offer instant access to vital, insurer-approved IR experts who will respond to your crisis in the middle of the night.”

Get a simple solution in place now, not later

It has become clear that data breaches and cyberattacks are more or less inevitable for organizations of all sizes. However, at NetDiligence®, we believe companies can combat cyber risk and minimize associated losses with proactive planning and preparation.

The most effective and cost-efficient approach for any organization to defend against cyber threats is to put a thorough, easy-to-access, easy-to-follow incident response plan (IRP) in place. Our turnkey IRP solution, Breach Plan Connect®, allows organizations to get an industry-standard, mobile-accessible plan in place quickly and easily.

With Breach Plan Connect, you’ll rest assured that your team is prepared and sharply aligned for when bad actors come knocking.

Assemble your breach team, keep response and recovery experts on speed dial, and get an actionable, step-by-step plan in place in minutes (yes, minutes). Plus, access your plan from anywhere through the Breach Plan Connect mobile app.

Click here and schedule your demo of Breach Plan Connect today.


Related Blog Posts

Download 2023 Cyber Claims Study

The annual NetDiligence® Cyber Claims Study uses actual cyber insurance reported claims to illuminate the real costs of incidents from an insurer’s perspective.


© 2024 NetDiligence All Rights Reserved.