As 82% of Companies Admit to Experiencing Payment Fraud, Customers Need to Be on High Alert
Payment fraud can do a lot of damage to businesses, but it can also affect their customers. Therefore, instead of leaving all responsibility of preventing such incidents to organizations alone, we recommend learning how to avoid payment fraud. No doubt, since a lot of organizations are now selling their products/services on the Internet, online payment fraud keeps increasing and is becoming a huge problem. Consequently, it becomes more and more vital to learn how to be safe while browsing as well as make secure online transactions. Because of this, further in the article, we talk more about online payment fraud, what it is, and what methods hackers usually use for such cyber-attacks. Also, we discuss what consumers can do to stop hackers from succeeding, and if you do not want to become a victim of online payment fraud, we invite you to read our full blog post.
What is payment fraud?
Payment fraud is when someone makes an illegal transaction, during which he can deprive the targeted victim of funds, obtain sensitive information, and so on. For example, the transaction could be made after stealing a user’s credit card. Obviously, online payment fraud is the same thing, only, in this case, the illegal transaction is made online, for example, after obtaining someone's banking login credentials.
According to the 2019 AFP Payments Fraud and Control Survey, 82 percent of questioned organizations admitted they had experienced payment fraud in 2018. The year before, the same was declared by 77 percent of respondents, which was 5 percent less. Thus, it looks like cases of payment fraud are increasing bit by bit every year. Specialists say it is only natural as online businesses continue to grow, and new payment methods are being introduced. This allows hackers to find more ways to commit online payment fraud.
What are the payment fraud methods?
There are lots of payment fraud methods attackers can employ, but we will list only a few of the most popular ones.
This method is often used for various other cyber attacks and not just online payment fraud. Phishing attacks can be carried out using emails, messages, phone calls, and so on. For example, cybercriminals attempting to steal targeted victim’s banking credentials could send him fake emails that might say the user has to submit such information to prevent someone from hacking into their banking account. If the victim provides the needed credentials, it could be enough for hackers to hijack and use his account to make fraudulent money transaction or, in other words, attempt online payment fraud.
Same as phishing, identity theft can be employed to commit various crimes. It is a type of crime when attackers steal information that identifies victims. For example, it could be your email’s login credentials, your credit card details, etc. Usually, hackers who commit payment fraud use stolen personally identifiable data to make fraudulent money transactions.
Is when hackers make illegal copies of content belonging to a legitimate website and place them on their site in an attempt to replicate the original website. This way unknowing users might be redirected to the fake website where their data could be stolen as they try to purchase anything or submit their sensitive data for any other reason; e.g., to answer a fake survey to get a discount.
It is a type of payment fraud when a user purchases something online and then asks to be refunded because he did not receive the ordered product or he does not remember doing it. Such actions result in money loss for businesses. Also, it can put the seller’s reputation at risk.
How to avoid payment fraud if you are a regular user?
In many cases, even if someone makes a fraudulent transaction in your name, you can report it and get your money back. However, if the attackers obtain your sensitive information, you may have other things to worry about. For instance, cybercriminals may use the information they have about you to take over your accounts, not to mention, they can sell it on the dark web to hackers who may have even bigger plans how to misuse it. Therefore, it seems to us it is in your best interest to know how to avoid payment fraud.
First of all, we would recommend learning how to recognize phishing attacks, so no one would be able to trick you into revealing your sensitive information via email, text messages, phone calls, and so on. Next, it is advisable to stay away from unreliable websites, especially if you come across online shops that offer expensive products for very low prices. Always remember the number one rule while surfing the Internet: if something looks too good to be true, it probably is not that good.
Another thing we highly advise is to stop typing login credentials to log into your accounts. Fake websites, pop-ups, and similar content might be able to record what you type, so it is best to avoid it. Instead, you should employ a password manager that could fill required fields automatically for you. Cyclonis Password Manager can both log you into your accounts and fill needed payment information or personally identifiable data for you.
All you have to do is install the application, choose where you wish to save your logins and other sensitive information (in an encrypted vault that is created on your device or preferred cloud storage), and save it on Cyclonis. The program has even more useful features that can help you strengthen your passwords, keep them secure, and make sure you never forget them. To learn more about other Cyclonis features, you should continue reading here.
All in all, purchasing products and services over the Internet can be both convenient and scary if you realize how huge the problem of online payment fraud is nowadays. Nonetheless, we encourage you to use our tips and the information that you learned while reading this blog post to protect yourself from such attacks. There are lots of things every one of us can do to protect ourselves from becoming a victim of online payment fraud, and, probably, the most important thing to do is never let your guard down.