Real estate wire fraud is growing. In 2017, it grew faster than any other type of real estate cybercrime. Also, scams are getting more complex. Fraudsters choose hard to detect business email compromise schemes and CEO fraud as their money-making weapons of choice.
However, criminals aren’t the only ones improving the methods they use. Technology startups, banks, and law enforcement agencies are all working on innovative solutions to help protect people from wire fraud.
Here are five trends that may protect you from fraud in the near future.
Improved Versions of Two-Factor Authentication
One of the keys to protecting your organization from wire fraud is stopping criminals gaining access to your accounts. One of the best ways to do this is via two-factor authentication (2FA). If you enable 2FA, even if a hacker discovers your password they won’t be able to access your account.
Most email providers already offer 2FA. But, the methods they provide aren’t always foolproof. SMS-based 2FA, which is one of the most widely used forms, has weaknesses that hackers can exploit.
Many services have already begun to let users protect their accounts with more secure forms of 2FA like authentication apps. Additionally, other —even more secure — methods of 2FA like Google Advanced Protection or hardware security keys could become more widespread as people wise up to the risks of cybercrime.
Perhaps the biggest challenge to 2FA in the future will be getting people to sign up and use it. A report earlier this year would have made happy reading for hackers; it suggested less than 10 percent of Gmail users have adopted 2FA.
Behavioral Biometrics Could Make Authentication Easier
Behavioral biometrics is a type of authentication currently being tested by some banks. It authenticates accounts based on the way the user interacts with the software. Software that tracks how you act may sound like something from a dystopian sci-fi movie. However, the implementation of the technology stands to be a serious barrier to fraudsters.
The main benefit of authentication via behavioral biometrics is that as well as being secure, it is an almost frictionless process. Because the software automatically analyses the user’s actions, they don’t need to input any information themselves.
The Royal Bank of Scotland is one organization currently experimenting with this type of technology.
The bank’s app records data such as how the consumer holds the phone, which fingers they use to navigate the app, and how much pressure they use when typing. On the computer, its software can tell the rhythm of the user’s keystrokes and the way they use their mouse.
This data is used to build a profile of the user which authenticates them every time they use the app. According to the company that designs the software, the system is 99 percent accurate. This number is only likely to increase as the technology improves.
More Advanced Spam Filters to Stop Email Fraud
Spam filters check emails for known signs of spam or fraud. Techniques they use include reviewing the sender’s address against a known database of spammers and analyzing the content of the email. Links to malicious websites or certain types of attachments will also be identified.
However, as scammers become more adept at sending targeted emails to their victims, the messages they send are less likely to contain clues that can be flagged by spam filters.
Because of this, filters have had to adapt. Machine learning techniques and cloud computing are enabling this adaption. By keeping all the information in the cloud, spam filters can work with data collected from many sources. This could lead to improved filtering.
Examples of companies that use this tech to power their products include ZapFraud and Tessian. These spam filters claim they can spot signs of fraud that conventional filters cannot. When the software detects signs of fraud in an email, it consigns them to the spam folder; where they belong.
AI Could be Used to Spot Fraud and Stop It in Its Tracks
Banks are currently introducing AI-based systems that can spot wire fraud and stop fraudulent transactions before they are made. These systems could detect in real-time when a customer acts in a way that is unusual. It would do this by comparing their actions to vast amounts of existing data.
Banks already have systems in place to detect fraud. However, as the many recent cases of wire fraud demonstrate, they don’t always work perfectly. By using more sophisticated fraud detection techniques powered by AI, banks will have the potential to spot fraud more accurately.
Tech to Make Fraud Less Appealing to Criminals
Recently, the UK’s Financial Conduct Authority said it is increasingly using machine learning algorithms to detect money laundering. In a speech in November, the head of the organization’s financial crime department said this could reduce the space criminals can operate in.
Reducing the effectiveness of money laundering could help make wire fraud less appealing to criminals. If fraudsters find it difficult to move money once they have it in their control, in theory, they will be less likely to attempt fraud in the first place.
Additionally, in instances where fraud does take place, making it harder for criminals to move money could also help victims get their stolen assets back.
Education is Key
Fraud protection is a cat-and-mouse game where scammers are continually reacting to the protective measures put in place by their targets. While the above advancements will make it harder for criminals to commit fraud, fraudsters are unlikely to give up.
Because of this, it is crucial to stay up-to-date about the types of threats you are up against if you regularly wire money. By doing this, and taking the relevant steps to protect yourself, you’ll be able to increase your chances of staying safe from fraud.
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