You are still your own best defence against losing money to online scammers, but the volume and sophistication of attacks are only increasing. — The Straits Times/ANN
ONLINE scams are a huge business and have become a full industry with sophisticated supply chains of services, equipment and labour.
Key groups in this sector also have direct connections to nations such as Russia, China and North Korea. What has long seemed to be just a lot of low-level crime has grown into a global, geopolitical problem.
You are still your own best defence against losing money to online scammers, but the volume and sophistication of attacks are only increasing.
Governments must do more to help defend their people, companies and institutions.
Cybercrime is a national security issue, and the entire system – from major hacking attacks to everyday phishing – should be taken as seriously as drug trafficking or terrorist financing.
To be fair, the problems have not been completely ignored, but national efforts have tended to focus on large-scale and direct ransomware attacks on states themselves, or their biggest services, such as healthcare. But these are just the tip of a massive iceberg.
Worldwide losses are hard to track, but potentially huge.
The Global Anti-Scam Alliance, a group formed of technology and finance companies as well as specialist consultants, estimates that in the past couple of years, consumers have lost more than US$1 trillion (RM4.4 trillion) each year to scammers. That is the same as Switzerland’s gross domestic product.
“The amounts being lost and the harm being done grow every year,” says Jorij Abraham, managing director of the group.
“The proceeds are used to fund other types of crime but also are reinvested in better technologies to improve the scam, using, for example, AI or to increase the reach of the scam, with marketing budgets of millions being used to advertise scams.”
The Google Threat Intelligence Group, part of Alphabet, reported on the links between cybercriminal groups and state interests at the recent Munich Security Conference.
Some state-sponsored groups have crime as a sideline to supplement their budgets, and some crime organisations are used by governments on a casual basis for specific, larger-scale attacks, data thefts or espionage. All are part of the same underground industry.
In the past few years, Abraham says, researchers have seen a sharp rise in crime syndicates across the globe with a strong specialisation in one type of scam, for example, online shopping, investment, romance, subscriptions and many others.
Criminals continuously improve their schemes and document how they can best be executed – and then export the tools, scripts and methods around the world.
Victims often get hit repeatedly, too. Between 2020 and 2021, while talking to victims of binary options trading scams, one truly shocking aspect I often heard was of people being contacted by supposed law firms with offers to help recover their losses, which turned out to be yet another drain on the savings of those who had fallen for the scam.
At that time, Abraham’s group was gathering reports about a then new trend of mainly Taiwanese and Chinese citizens being duped by offers of well-paying work in South-East Asia, only to find themselves trafficked as indentured labour for scam groups. Things have got worse:
A recent podcast series by The Economist interviewed people who had been trafficked from the Philippines, countries in Africa and elsewhere, who described their lives in a walled-off “scam town” deep in the Myanmar countryside.
A major worry is that AI tools will make all of this easier and cheaper for criminals – and will make large-scale high-value scams even more difficult to stop. In 2024, an employee at a Hong Kong-based company was tricked into sending US$26mil to thieves who used an AI filter on a video call to disguise themselves as the company’s chief financial officer.
Battling scams has mainly been left up to banks, which have spent heavily on compensating customers and investing in education and warning systems in countries like the UK.
Finance companies, in turn, have been crying out for more help from internet and social media companies to track and block bad actors. AI and the spread of crypto are making these efforts less effective.
The Google Threat Intelligence Group’s recommendations for governments include stronger education and awareness campaigns to help people defend themselves, as well as potentially more powers for banks and technology companies to act directly against criminal groups.
In truth, countries need to start treating scams and other cybercrime like they do drug trafficking and terror. That means international cooperation on intelligence and enforcement, where possible, as well as choking the financial flows through banking networks and crypto exchanges.
What is most troubling is that just as the US is turning its back on exactly this kind of cooperation and enforcement, it is also promising to unshackle crypto and potentially dilute banks’ defences against dirty money.
Other countries will be tempted to follow suit. If that continues, criminals and unfriendly states will get rich and win, while the citizens of America and other countries will foot the bill. — Bloomberg/TNS
