Researchers have discovered a widespread criminal network that are using online shops to steal credit card information.
The digital commerce world is faced with a challenging problem of sophisticated cyber threats that affect not only consumers but also institutions such as insurers, reinsurers, MGAs, and banks. Recently, Security Research Labs conducted an investigation that revealed a widespread criminal network that operates counterfeit e-commerce sites. The network has processed over a million orders, which are worth approximately USD 50 million in the past three years. These fraudulent activities mainly target unsuspecting consumers in Western Europe and the U.S, with over 850,000 individuals reportedly already falling victim to them.
The Continuing Risk of Fraudulent E-Commerce Shops
The shift from traditional brick-and-mortar stores to online shopping venues has provided more opportunities for cybercriminals to operate. These fraudulent entities are primarily motivated by the desire for financial gain and engage in activities such as credit card fraud and the sale of counterfeit or non-existent products. The increasing dependence on digital platforms, along with recent advances in artificial intelligence, has made it easier for these criminals to create believable online stores and persuasive marketing content in multiple languages.
Implications for Cyber Insurers and Financial Institutions
The implications of cyber fraud are significant for both insurance providers and banks. Such fraudulent activities not only affect the consumers but can also result in cyber insurance claims, financial losses and other chargebacks that banks and card providers must bear. This highlights the importance of consumer awareness, education, and effective personal cyber risk management.
How to Spot and Avoid Fake Online Shops
Recognising fraudulent e-commerce websites can be challenging, as many appear highly professional and convincing. However, consumers can take proactive steps to protect themselves:
- Assessment of Credibility: Before making a purchase, it is essential to evaluate the website carefully. Check for official details such as contact information, social media accounts, and official registration numbers (VAT, for example). Analysing the quality of the website copy and reviewing customer reviews can also offer insights into the legitimacy of the business.
- Realism of Offers: If an offer seems too good to be true, it likely is. For instance, branded products being sold at a fraction of their typical price should raise red flags.
- Verification: Verifying the authenticity of a business can be as simple as conducting a search through official registries like Companies House or examining its online presence and customer feedback.
- Using Cyber Xpert for Enhanced Security: In addition to these precautions, adopting comprehensive cyber security measures is crucial. This is where Cyber Xpert comes into play. Our platform enables consumers to monitor personal data for potential breaches, including sensitive information like email addresses and credit card details. By providing alerts and a tailored action plan, Cyber Xpert allows for swift remedial action, minimising the risk of further damage.
Insurers, reinsurers, MGAs, and banks can embed our software into cyber insurance products or banking benefits to enhance the value they provide their customers. Our partners from across the globe are seeing huge benefits from providing their customers with our education and risk management software, helping them to grow sales, prevent or mitigate losses and increase engagement.
Contact our team today for more information on how Cyber Xpert can be integrated into your services or to discuss potential partnerships.