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Companies and Consumers Face Increased Fraud and Cybercrime Risks

A new report from risk solutions company Kroll has revealed that fraud, cyber, and security risks to companies have reached an all-time high. 

Incidents of Fraud Increase

With regards to fraud, the proportion of executives reporting that their organisations suffered at least one instance of this crime over the past 12 months apparently increased to 84%, from 82% in the previous survey. Levels of reported fraud have steadily risen every year since 2012, when the reported occurrence was just 61%.

For the first time in the Kroll Report’s 10-year history, information theft, loss, or attack was the most prevalent type of fraud experienced, cited by 29% of respondents, up 5% from the previous year. This replaced theft of physical assets or stock, long the most common type of organisational loss, which this year was the second most frequently cited incident (27%).

Cybercrime Increasingly Prevalent

Cybercrime seems to be even more prevalent than fraud, with as many as 86% of executives reporting that their companies had experienced a cyber incident or information theft, loss, or attack over the past 12 months, slightly up from 85% in 2016. Around 70% reported the occurrence of at least one security incident during the past year, compared to 68% in the previous survey.

“In a digitised world with growing levels of data creation, collection, and reliance for businesses, information assets have become increasingly valuable and exposed to threats,” commented Jasom Smolanoff, Senior Managing Director and Global Cyber Security Practice Leader at Kroll. “Exacerbating the challenge of safeguarding data is that criminals and other threat actors are continually developing new ways to monetise confidential information, including personal data”.

Insiders and ex-employees continue to pose the greatest threat to companies around the world. Respondents revealed that fraud, cyber, and security incidents are often inside jobs perpetrated by members of management or current, former, or temporary/freelance employees.

Of those reporting a fraud incident, 81% cited one or more insiders as perpetrators; likewise, 58% of respondents who reported a cyber incident and 71% of those who experienced a security incident primarily identified insiders as the perpetrators.

Junior employees were the most commonly named perpetrators of fraud incidents (39%) and former employees were blamed most frequently for security incidents (37%). However, for respondents who had experienced a cyber incident in the last 12 months, a random cyber-criminal or threat actor was the single most commonly named perpetrator (34%).

Increased Risk for Consumers

Companies aren’t alone in facing an increased threat from cybercrime and fraud. According to a new report, consumers are also at risk and lost as much as £130bn to hackers in 2017.

The 2017 Norton Cyber Security Insights Report also gave an interesting insight into attitudes towards some cybercrimes.

It found that 81% of consumers believe cybercrime should be treated as a criminal act. However, when pressed, contradictions emerged.

Nearly one in four believe stealing information online was not as bad as stealing property in 'real life.' When presented with examples of cybercrime, 41% of consumers believed it's sometimes acceptable to commit morally questionable online behaviours in certain instances, such as reading someone's emails (28%), using a false email or someone else's email to identify themselves online (20%) and even accessing someone's financial accounts without their permission (18%).

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If you have been charged with a fraud or cyber-related offence then contact our expert criminal defence lawyers today.

 

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