How Businesses can protect vulnerable customers against Fraud & ID Theft
5th October 2017
HOW UNDERSTANDING ‘CUSTOMER VULNERABILITY’ CAN HELP PROTECT AGAINST FRAUD & IDENTITY THEFT
Managing Customer Vulnerability is about engaging with customers and local organisations and
understanding the risks and putting in place simple but effective policies that will minimise Fraud and Identity Theft as well as supporting those customers who have been targeted
In this article 360ict addresses an important element of any businesses risks namely customer protection:
How vulnerable customers can be better protected against fraud – We also provide some specific Identity Theft Information and tips.
DEFINING VULNERABILITY VULNERABILITY CAN BE GROUPED INTO THREE CATEGORIES AND CUSTOMERS IN EACH CATEGORY CAN BE TARGETED DIFFERENTLY
CHANNELS AND ACCESS
- HEARING OR SIGHT IMPAIRMENTS
- LANGUAGE BARRIERS
- PHYSICAL DISABILITIES
These customers may find it difficult to verify whether something is a scam, for example, through lack of ability to interact online or the inability to easily get to a physical branch.
- MENTAL CAPACITY
- LACK OF FINANCIAL UNDERSTANDING
- COMPREHENSION CHALLENGES RELATING TO AGE COMPREHENSION
Customers’ comprehension can be manipulated, with fraudsters generally finding it easier to convince a customer with these challenges to cooperate with them.
- JOB LOSS
- FAMILY BREAKDOWN
Customers in these testing or unfamiliar circumstances could be more susceptible to scams via emotional manipulation. They may also be unaware of firms’ standard processes around these issues – this can also be manipulated.
HOW CAN VULNERABILITY BE EXPLOITED BY FRAUDSTERS?
SOCIAL ENGINEERING – Face to Face contact, Emails, SMS (phishing etc) from Fraudsters claiming to represent Banks and the like
CUSTOMERS POOR DATA SECURITY – Customers revealing personal information through Social Media which allows Fraudsters to compromise their Identity
TIPS FOR BUSINESSES TO PROTECT VULNERABLE CUSTOMERS
- Be PROACTIVE in identifying customers at risk and take specific action
- Support your frontline staff with proactive identification
- Share customer related intelligence and be aware of regulatory or industry requirements
- Be aware there could be public sector partners to work alongside
- Promote customer awareness through all your business channels
- Develop in-house or externally a specialist advice plan to support customers targeted by scams
Identity Theft Prevention – A great example above from UK Power Networks who have engaged with the Vulnerbale through a number of schemes.
For more Information on Identity Theft click here forAction Fraud Police
BUSINESS IDENTITY THEFT is a newer phenomenan, which 360ict will address in a later post – Business identity theft is not an information security breach , or an incident involving the loss or theft of confidential consumer information that a business may possess. Rather, like its consumer crime counterpart, business identity theft involves the actual impersonation of the business itself .
Business identity theft schemes frequently target small to medium size-businesses for the purpose of quick financial gains.
Determined criminals can employ more sophisticated tactics designed to impersonate and defraud even a large, well recognized company, and the lengths to which they are willing and able to go can be shocking. To illustrate, consider the following case involving well-known computer and electronics manufacturer, NEC Japan.
In May of 2006, a private investigation conducted by international risk management and investigations firm, Investigative Risk, uncovered a sophisticated ring of criminals that had established a complete NEC-branded company. By the time that the operation was finally shut down, this bogus company, operating in Hong Kong, China, and Taiwan, had more than 50 factories producing a complete line of counterfeit NEC products, including computer keyboards, computer peripherals, CDs, and DVDs. The company was even reportedly developing its own MP3 players and home entertainment systems. The persons operating the factories utilized counterfeit NEC identification, and several of the buildings brazenly displayed NEC signs. Products were shipped in NEC labeled boxes, and the company even went so far as to charge royalties to other companies to license the products that it produced. The counterfeit NEC products produced by this company were reportedly discovered being sold throughout China, Taiwan, Southeast Asia, the Middle East, North Africa and Europe. As some small measure of consolation, according to NEC, the counterfeit products were deemed to be “of generally good quality.” Had they been of significantly inferior quality, the operation may have eroded consumer confidence in legitimate NEC products, and the NEC brand, causing further losses beyond significant lost revenues.
If a large, high-profile, international manufacturing company such as NEC could be victimized in this manner, how easy would it be for a smaller, lesser-known company to become a victim
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