A Thing
The Green SheetGreen Sheet

The Green Sheet Online Edition

January 24, 2022 • Issue 22:01:02

The top six things that changed online fraud in 2021

By Bence Jendruszak and Tamás Kádár

It's been a busy time in the cybersecurity and online fraud prevention space. Overall, cybercrime is on the rise, with attacks becoming more complex and impactful. Of course, the situation isn't helped by the fact that many of us now work remotely. This new reality has created several additional vulnerabilities within online operations, which cybercriminals are only too happy to exploit.

As we begin a new year, we thought we'd share our observations about the top trends that changed fraud in 2021. We split the discussion, with Bence Jendruszak, SEON co-founder and chief operating officer, discussing points one through three, and Tamás Kádár, co-founder and chief executive officer, addressing points four through six.

1. Ransomware-as-a-service-type business models took off (BJ)

Whether the company is Spotify, Netflix or another familiar name, we've all heard about software-as-a-service (SaaS) businesses. It's a great business model, with a ton of advantages for end users. Sadly, cybercriminals seem to also agree and are now utilizing this method to package already developed ransomware tools for buyers on the dark web.

It's a frightening development, which really underlines the increasingly sophisticated nature of many online crooks, as well as the incredible demand for their services. It has also greatly reduced the barriers to entry for those looking to commit acts of cybercrime, which significantly increases the risk of these attacks occurring.

2. Online fraud got much easier (BJ)

In keeping with that theme, it is also worth noting how much easier online fraud became in 2021. We've been keeping a particularly close eye on virtual SIM cards, which often allow online fraudsters to get around two-factor authentication and one-time password security protocols.

As well as being readily accessible, virtual SIM cards are incredibly cheap. The technology is enabling cybercriminals to commit significant levels of fraud at an insignificant price. What's more, it's also rendering many phone authentication techniques obsolete, which is a real shame, as they were previously effective.

3. Device fingerprinting became essential, but harder (BJ)

Device fingerprinting techniques gather thousands of data points to detect device IDs, bots and emulators to confirm that users are who they say they are. As such, they can be used to block suspicious logins, prevent account takeovers, and identify multi-accounting attempts. However, the movement toward privacy, as well as several Apple-led initiatives, have made this technique harder to pull off in 2021.

As we enter a new year, it's now apparent that businesses need access to modern device fingerprinting solutions to build effective cybersecurity frameworks. That's why it makes sense to go one step further, combining device fingerprinting with real-time data enrichment, IP, email and phone analysis, as well as create custom risk scores using detection rules based on machine learning insights.

4. Online fraud became too expensive to ignore (TK)

Fueled by the further shift towards online shopping, 2021 was undoubtedly the year that online fraud became too expensive to ignore. Whether you're running a business that stores information in the cloud, or an ecommerce retailer selling to customers, this past year has highlighted how effective cybercriminals have become at eating into your bottom line. Businesses can no longer afford to scrimp on cybersecurity and must view it in the same light as traditional, physical security measures. To ensure this is the case, there is a growing need for flexible, adaptable and scalable cybersecurity solutions that are accessible to all businesses regardless of sector, or size.

The most progressive online businesses now consider cybersecurity to be an infrastructure cost and part of the gross margin. As such, spending in this area can no longer be considered a luxury. What's more, it is often an effective way to help attract new customers in a highly competitive business landscape.

5. Collaboration on fraud prevention increased (TK)

One of the things I was most pleased about in 2021 was the growth in industry collaboration relating to fraud. Companies within the fraud prevention space are increasingly coming together to share insights with one another and to develop closer lines of communication regarding new and emerging threats.

I feel like this is a really important development, especially in the wake of a surge in online fraud attempt rates. It also means that the sector is finally acting more like the fraudsters themselves, who are always sharing tips and tricks with each other to help stay ahead of new security measures.

6. The metaverse got a big push (TK)

While this choice might seem a little left field at first, I think it has the potential to have the biggest impact on online fraud long-term. Mark Zuckerberg's long-debated push toward the metaverse is finally in motion and could soon have major implications on cybersecurity and fraud, which the sector would be wise to proactively prepare for.

Most notably, the new technology raises the question: how do we get people to authenticate themselves in an environment that's increasingly based online? It's a really interesting challenge and one that's also pertinent to the problems we face today, particularly with many of us still working from home.

Side Note:

Metaverse, an evolving concept

The metaverse can be thought of as "the world’s digital counterpart," wrote Jyota Gupta on the Quyteck blog. "[It is] a perfect fusion of physical, augmented, and virtual reality."

Writing for Wired magazine, Eric Ravenscraft wasn't so sure. He likened defining "metaverse" today to discussing what "the internet" meant in the 1970s. "To help you get a sense of how vague and complex a term “the metaverse” can be," he wrote, "here's an exercise to try: Mentally replace the phrase 'the metaverse' in a sentence with 'cyberspace.' Ninety percent of the time, the meaning won't substantially change. That's because the term doesn't really refer to any one specific type of technology, but rather a broad shift in how we interact with technology." end of article

Bence Jendruszak is co-founder and chief operating officer and Tamás Kádár, co-founder and chief executive officer of SEON, a company they created as a side project while in college because they found that what passed for state-of-the-art in legacy fraud prevention wasn't up to the task of cutting down attacks on their cryptocurrency exchange. SEON now has hundreds of employees, staggering year-on-year growth and tens of thousands of clients, and the founders are still in their twenties. Contact Bence at www.linkedin.com/in/bence-jendruszak/?originalSubdomain=hu and reach out to Tamás at www.linkedin.com/in/tomkadar/. For more information about SEON, please visit www.seon.io.

The Green Sheet Inc. is now a proud affiliate of Bankcard Life, a premier community that provides industry-leading training and resources for payment professionals. Click here for more information.

Notice to readers: These are archived articles. Contact names or information may be out of date. We regret any inconvenience.

Prev Next

Current Issue

View Archives
View Flipbook

Table of Contents

Lead Story
Company Profile
New Products
A Thing