Financial fraud is any sort of dishonesty done in the course of monetary transactions. This is a major concern for Malaysia's finance and financial technology industries.
While fraudsters can reach out to potential victims in a variety of methods, including face-to-face interactions, mail, phone calls, SMS, and/or emails, internet fraud is the fastest-growing strategy employed by cybercriminals. This is owed to:
The increasing sophistication of cybercriminals has made it challenging for individuals and businesses to stay ahead of potential threats. Fraudsters are constantly developing new tactics to exploit vulnerabilities in online systems. This includes using advanced phishing techniques that mimic legitimate websites and communications, making it difficult for even the most cautious users to distinguish between genuine and fraudulent interactions. As a result, both individuals and organizations must remain vigilant and continuously update their security measures to protect against these evolving threats.
The internet presents challenges in verifying identities and legitimacy, allowing fraudsters to divert visitors to bogus sites and steal personal financial information. Additionally, fraudsters can easily conceal their true location due to the internet's global reach. Fortunately, there are techniques to safeguard oneself from such illicit conduct.
Verify who is contacting you
A fraudster steals your identity and uses your personal information, such as bank account or credit card details, to conduct fraudulent online or in-person transactions. They often get a victim's personal information by impersonating a representative from an authority, such as a bank or government office, and convincing them that the information is necessary for official purposes.
In recent years, there has been a surge in scams involving fake investment opportunities, where fraudsters promise high returns to lure victims into transferring money. These schemes often involve convincing narratives and professional-looking websites that can easily deceive unsuspecting individuals. It's crucial to conduct thorough research and seek professional advice before committing to any financial investment. Always verify the legitimacy of the investment firm and ensure they are registered with relevant financial authorities.
Other illegal ways to collect the same information include cash skimming, card cloning, phishing, vishing, and spoofing.
Be wary of unexpected phone calls from someone claiming to hold positions of authority and asking such sensitive information. Call the given organisation to identify the individual.
Secure your accounts
To monitor and secure your banking or credit card transactions, you can take the following steps:
Set up SMS or email alerts for your bank accounts. You can set up alerts to notify you when an account receives a deposit, a transaction is completed, your debit card is used, or your balance reaches a specific threshold. By doing so, you can discover any unauthorized activity on your account before it causes significant damage.
Set up alerts for weekly balance updates. While most people take money from their accounts on a regular basis, some users leave their savings accounts unattended for extended periods of time.
By setting up notifications, you will receive a balance update notifying you of any changes from the previous week, even if your account is inactive for more than seven days.
Create alerts for credit card transactions. Credit card notifications, like bank account alerts, should be set up for charges that exceed a predefined limit. You can also receive notifications when your card is used to make a cash withdrawal or when your total balance exceeds a certain amount.
Set up a weekly credit card balance alert to see whether it has been used without your awareness.
In addition to setting up alerts, it's advisable to regularly review your bank and credit card statements for any discrepancies. This proactive approach can help you quickly identify any unauthorized transactions and report them to your financial institution. Many banks offer fraud protection services, which can provide an added layer of security and peace of mind. By staying informed and vigilant, you can significantly reduce the risk of falling victim to financial fraud.
Contact your bank if you plan to travel. If you want to travel for work or pleasure, notify your bank to authorize overseas transactions.
Use secure online banking. Contacting your bank via email is less secure than using its secure channels. The recipient has no way of identifying who sent the email, thus the institution will be unable to respond and is not authorized to send personal or financial information by email.
Take precautions while online
The internet is teeming with harmful malware, spam, and spyware, so be sure your computer has security software installed and updated. Other security measures include:
Using complex passwords. Most people use common passwords for a variety of purposes, including sensitive operations like online banking and credit cards. While this makes passwords easier to remember, it may represent a security risk.
Make sure you use complex alphanumeric passwords for all transactions.
It's also a good idea to update your passwords on a regular basis and have distinct ones for each account. A strong password consists of at least eight characters, including letters, numbers, and special symbols.
Update your passwords on a regular basis and keep them secure by writing them down or using a password management application.
Avoiding public WiFi. Always perform transactions using your own computers or mobile phones. Additionally, always connect to the internet via a secure WiFi connection that is password protected.
Financial transactions over a public WiFi connection are extremely dangerous and should be avoided.
Being cautious with emails. Any promotional communications that request your bank information should be ignored and reported as spam. Keep in mind that your bank will never ask for your financial credentials.
If you frequently receive promotional emails from stores, go straight to the seller's website rather than putting information into a coupon link provided by third parties.
Cybersecurity experts recommend using two-factor authentication (2FA) for an added layer of protection. 2FA requires users to provide two forms of identification before accessing an account, typically a password and a verification code sent to a mobile device. This method significantly reduces the chances of unauthorized access, even if a password is compromised. Implementing 2FA on all accounts, especially those related to financial transactions, is a simple yet effective way to enhance online security.
Examining SSL certificates Many small sellers fail to include security processes, which can endanger security. It is preferable to perform online transactions through websites that start with https rather than http, which does not provide appropriate encryption.
Logging off Always log out of your bank's or merchant's websites after you've completed a transaction.
Always ask questions.
If you own a business, here are some questions to keep your firm vigilant:
Are there especially favorable or unfavorable financial terms with banks? Do any suppliers appear to be getting disproportionately large amounts of the business, or are they paying significantly higher than market rates? Do some customers appear to receive much better prices and terms than others? Investigating the answers might help you keep one step ahead and safeguard your company from fraudulent activities.
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