how to protect yourself from fraud in a pandemic

Fraudsters are ruthless and will use any means necessary to gain financial advantage.

Earlier this year, as Australians were battling the devastating bushfires^[1], fraudsters were tailoring their approaches to exploit^[2] the good intentions of citizens wanting to help victims.

And come March and the declaration of COVID-19 as a global pandemic^[3], offenders have seamlessly shifted their approaches to take advantage of yet another crisis.

Online fraud on the rise during COVID-19

Given the known links between natural disasters^[4] and fraud^[5], it is unsurprising offenders are using COVID-19 to target potential victims. While there are limited statistics on crime rates during this period, evidence suggests fraud and other online scams have spiked.

The Australian Competition and Consumer Commission (ACCC) issued^[6] an alert this week warning of a dramatic spike in identity theft, with some 24,000 reports of stolen personal information this year, a 55% increase over the same time last year.

Further, Scamwatch has received more than 3,600 reports^[7] specifically mentioning COVID-19, with victims so far claiming losses of about $2.3 million.

Fraud costs millions of dollars annually, as shown in the ACCC’s latest Targeting Scams^[8] report. It found that in 2019, Australians reported losing more than $634 million to fraud, a dramatic increase from $489 million^[9] in 2018.

Fraud is an underreported^[10] crime, so these figures are likely to be a fraction of the actual losses incurred by victims. In addition, there are many barriers^[11] to victims reporting scams. They might not realise they are a victim, for example, or might not know where to report such crimes. Some people also feel a strong sense of shame and embarrassment at having been deceived.

The government is putting more attention on the threat of fraud and other cybercrime with its newly released cybersecurity strategy^[12], which will see a record $1.67 billion invested in cybersecurity and cybercrime prevention over the next decade.

Read more: Some crimes have seen drastic decreases during coronavirus — but not homicides in the US^[13]

What types of fraud are occurring now

There is nothing new in the ways offenders are targeting potential victims at the moment. Rather, we are seeing well-established schemes reappearing under the guise of COVID-19.

Online shopping fraud

With more people at home during the pandemic, there has been a substantial increase in online shopping^[14]. Consequently, there has also been an increase in online shopping fraud.

Some of these schemes involve fake websites and social media pages^[15] being set up to sell goods to people that never arrive, including personal protective equipment^[16] and even puppies^[17].

There has also been a rise in online sales of products^[18] that simply do not exist or work as promised, such as coronavirus testing kits^[19] or supposed cures for the virus^[20].

Phishing

Fraudsters use phishing emails and text messages as a means of getting personal information from victims, like bank account details and passwords. Phishing attempts usually come from what appear to be legitimate sources, persuading recipients to click on a link or reply with required personal information.

In the context of COVID-19, phishing attempts are being launched under the guise of government departments^[21]. Some messages claiming to be from health authorities say the recipient has had contact with a known case of the virus, for instance, while others advertise the need for testing.

Read more: Working from home risks online security and privacy – how to stay protected^[22]

Others have pretended to be the Australian Taxation Office^[23] with offers of tax refunds or the availability of government benefits or support payments.

In addition, offenders have also used the pretext of legitimate businesses^[24] like Coles and Woolworths, appearing to offer services or discounts to those who are struggling. Other approaches are using the Australia Post logo to ask people to pay additional fees for delivery^[25] of purchased items.

Increased vulnerability to fraud

These examples highlight how offenders exploit anxiety to take advantage of people in uncertain times. They play on people’s fears and anxieties.

Everyone is vulnerable^[26] to fraud. Research suggests there is “no typical fraud victim^[27]”. However, COVID-19 has arguably made more people vulnerable to fraud across large sections of society.

Isolation and loneliness can increase vulnerability. Without the presence and accessibility of support networks (such as family and friends), individuals may be more responsive to fraudulent approaches.

Economic hardship could also make people more susceptible to fraud. Offenders do not need to offer outrageous returns for their approaches to be attractive to potential victims. People are more motivated than ever to improve their financial situations, which plays into the hands of fraudsters.

How you can protect yourself

It is important people understand how fraudsters work and are using the crisis to their advantage, so they can take the necessary steps to protect themselves. Here are a few tips to prevent becoming a victim.

• Stay connected to family, friends and colleagues, even in a virtual environment. Offenders relish the isolation of victims to increase the success of their attempts.

• Talk about what is happening. Ask someone directly if they have received any strange emails or phone calls. Offenders rely on secrecy and shame^[28] to keep people silent about their victimisation.

• Be vigilant with emails, phone calls, texts and even those who knock on your door. Do not feel you have to respond to anything immediately and take the time to think about and seek advice. Offenders rely on immediate responses from people that overcome any rational thought.

• Report any fraud attempts or losses you may have incurred to Scamwatch^[29] or ReportCyber^[30]. Also, contact your bank if you have lost money, or a service like IDcare^[31] if you have had your identity compromised. It is important for these organisations to be able to gain accurate figures on the prevalence of fraud during these times.

COVID-19 has thrown the world into uncertainty. But one thing that’s clear is fraudsters will remain active and continue to target victims. We need to recognise this changing environment, support each other and collectively do as much as possible to guard against fraud victimisation.

Read more: Beware of bushfire scams: how fraudsters take advantage of those in need^[32]

References

1. ^{^} bushfires (theconversation.com)
2. ^{^} exploit (www.scamwatch.gov.au)
3. ^{^} global pandemic (www.who.int)
4. ^{^} natural disasters (www.fcc.gov)
5. ^{^} fraud (www.researchgate.net)
6. ^{^} issued (7news.com.au)
7. ^{^} 3,600 reports (www.scamwatch.gov.au)
8. ^{^} Targeting Scams (www.accc.gov.au)
9. ^{^} $489 million (www.accc.gov.au)
10. ^{^} underreported (eprints.qut.edu.au)
11. ^{^} barriers (www.aic.gov.au)
12. ^{^} cybersecurity strategy (www.homeaffairs.gov.au)
13. ^{^} Some crimes have seen drastic decreases during coronavirus — but not homicides in the US (theconversation.com)
14. ^{^} increase in online shopping (www.abc.net.au)
15. ^{^} fake websites and social media pages (www.abc.net.au)
16. ^{^} personal protective equipment (www.canberratimes.com.au)
17. ^{^} puppies (www.scamwatch.gov.au)
18. ^{^} products (www.theguardian.com)
19. ^{^} coronavirus testing kits (www.fda.gov)
20. ^{^} supposed cures for the virus (www.abc.net.au)
21. ^{^} government departments (www.scamwatch.gov.au)
22. ^{^} Working from home risks online security and privacy – how to stay protected (theconversation.com)
23. ^{^} Australian Taxation Office (www.ato.gov.au)
24. ^{^} legitimate businesses (www.canberratimes.com.au)
25. ^{^} fees for delivery (auspost.com.au)
26. ^{^} vulnerable (www.youtube.com)
27. ^{^} no typical fraud victim (fraudresearchcenter.org)
28. ^{^} secrecy and shame (eprints.qut.edu.au)
29. ^{^} Scamwatch (www.scamwatch.gov.au)
30. ^{^} ReportCyber (www.cyber.gov.au)
31. ^{^} IDcare (www.idcare.org)
32. ^{^} Beware of bushfire scams: how fraudsters take advantage of those in need (theconversation.com)