As technology continues to evolve, SIM swap fraud has become more of a concern than ever before. The rise of smartphones and mobile apps, along with the constant growth of the mobile sector, have all lead to a growing need to protect sensitive data. Banking apps, online banking and mobile banking have certainly paved the way for a greatly improved way for consumers to make payments quickly and simply. While there is no doubt that mobile technology will continue to grow, it is essential to consider the risks that expanding technology can pose.
According to a report published by Business Live, recent crime statistics released by the Sabric (the SA Banking Risk Information Centre) state that digital banking fraud increased 75% in 2018 and banking app fraud increased 54%. This report notes that 23,466 incidents occurred in 2018, on banking apps, online banking and mobile banking platforms, with a total revenue loss of over R260 million.
Sabric states that increased use of banking apps and mobile banking is a major reason for the rise of mobile banking fraud. One of the most common scams includes voice phishing or vishing. According to Sabric, these scams increased a staggering 200% in 2018 with 11,077 incidents reported between 1 January 2018 and 31 December 2018. In this scam, fraudsters pose as banking officials or service providers to try and trick consumers into releasing sensitive information including one-time passwords or random verification numbers.
Emails can also be sent to trick consumers into clicking on a link that allows scammers to obtain banking details. Once scammers have this information, they are able to pose as the victim to request a SIM swap from the victim's mobile network provider. With access to one-time pins and other security messages, fraudsters can make transactions quickly and easily.
Mobile banking is typically done using USSD, which acts as a channel between banks and mobile operators.
Many victims of SIM swap fraud only realise that they have been scammed when they are suddenly unable to access their mobile network. Resolving this type of fraud requires fast action to put a hold on bank accounts and communication between victims, banks and mobile network providers.
How Does SIM Swap Fraud Work?
How exactly does SIM swap fraud work, and how can you identify suspicious SIM swaps to prevent fraud before it happens? Being able to monitor your customers' SIM swaps in a way that protects against fraud and other risks is the best way to provide full peace of mind for all mobile transactions.
What is SIM swap fraud?
As we mentioned above, SIM swap fraud is a phishing scam that involves scammers accessing banking details through phishing emails or calls. Scammers pose as bank or mobile network providers to trick consumers into releasing information such as one-time pins or verification numbers. Further information on the consumer is often sourced through social media, including full name, date of birth or any other details that can help scammers pose as their victims. Once this information is obtained, scammers can pose as their victims, getting mobile network operators to cancel or reactivate their victim's mobile number to their SIM. All messages and calls to the victim's phone are then routed to the scammer – including passwords needed to conduct banking transactions. This gives fraudsters full access to their victim's bank account.
Why is this crime increasing?
The growth of online and mobile banking, combined with the constant growth of technology, in general, has paved the way for increased sophistication in a number of digital crimes. In the case of mobile banking, it is not always easy to detect scams such as SIM swap fraud. Many network controls and processes are limited, with human error and even involvement reported in some cases. Banks continue to find new and improved ways to deal with these crimes. Enhanced authentication processes are needed to identify fraudulent transactions. Technology such as SIM swap detection offers the most effective way to safeguard sensitive information, making it easier for transactions to take place securely.
Introducing SIM Swap Detection from Grapevine
Grapevine offers a simple, highly effective way to deal with SIM swap fraud. Offering a tool designed for businesses wanting to protect their customers' data, this solution offers an enhanced level of protection that prevents sensitive data breaches.
How does SIM Swap Detection work?
SIM Swap Detection performs real-time checks on customer information, allowing banks to monitor SIM swaps more effectively. The risk of scams can also be assessed, allowing action to be taken more easily – whether it is freezing customer accounts, terminating transaction or expanding the verification process on alternative channels. This could involve steps such as the following:
- Bank is notified that someone is trying to add a new beneficiary to an account
- User attempts to add beneficiary through a mobile banking app
- Bank sends advanced push notification to the user's number to complete the action
- User confirms the transaction with a tap
- Bank determines whether a SIM swap has occurred
- Bank further validates whether the transaction is valid by sending a security question through a push notification
- If user is unable to answer this question, bank takes further action, preventing scammer from completing transaction
How does SIM Swap Detection help?
One of the biggest loopholes in transaction security is a weakness in two-factor authentication and verification, with one-time pins or passwords sent to mobile phones. SIM swap checks can be implemented on more than one device as an extra level of protection. An added layer of security can help not only to reduce the danger of SIM swap fraud but also prevent damage to reputation, lost time and lost funds. These measures help provide better peace of mind to customers, too.
Grapevine's SIM Swap Detection service offers fast integration, with a simple API that easily integrates this tool into current work flows and systems. Customer satisfaction is also improved through carefully utilised customer data generated by mobile networks to enhance security against fraud. As the service is cloud-based, there is no need for expensive on-site infrastructure, making this solution even easier to implement.
Contact Grapevine today to learn more about our SIM Swap Detection service and find out how it can help you prevent SIM swap fraud.