Year-End Season – A Time of Joy and Scams
The year-end holiday season is a time of joy and celebration, marked by festivities such as Black Friday, Thanksgiving, and Christmas. It’s a season when people come together to exchange gifts, show appreciation, and enjoy special moments with loved ones.
However, for enterprises and retail businesses, this time of year is not only a season of abundance but also a season of vulnerability. As holiday spending surges, so does the risk of cyber attacks and scams in the retail sector.
Holiday Scams: The Unwanted Gifts
During the holiday season, a variety of scams emerge, preying on the festive spirit and increasing online and in-store shopping. These holidays scams come in different forms, each designed to deceive and defraud.
- Online Shopping Scams: Scammers set up fake online stores offering enticing discounts on popular holiday items. Shoppers may make payments through mobile payment systems, only to receive counterfeit or non-existent goods in return.
- Phishing Emails and Messages: Cybercriminals send fraudulent emails and messages that appear to be from reputable sources, such as delivery companies or retailers. These messages often contain malicious links or attachments that, when clicked, can lead to financial loss or data theft.
- Gift Card Scams: Scammers may impersonate loved ones or authority figures, requesting gift card payments via different payment gateways for various reasons. The victims, thinking they are helping a family member or avoiding legal trouble, often fall prey to these scams.
- Charity Scams: The holiday season is a time for giving, and scammers exploit this by posing as charitable organizations. They collect funds for fake causes, leaving well-intentioned donors with empty digital wallet.
- Travel Scams: With many people traveling during the holidays, scammers create fake travel deals and accommodations that seem too good to pass up. Once payments are made, the promised vacations turn out to be non-existent.
Unpacking the Reasons Behind Year-End Holiday Scams
Why do holiday scams occur most frequently during the year-end holiday season? The answer lies in the human factor. The holiday season presents a unique opportunity for scammers to exploit human emotions and behavior.
Social Engineering – The Seasonal Deception
One key reason behind the surge in holiday scams is social engineering. Scammers leverage the goodwill and festive spirit of the season to dupe unsuspecting individuals. They send out heartwarming seasonal wishes and greetings, which may often conceal malicious intentions. Holiday cards and messages, seemingly from friends and family, become perfect cover for scam tactics.
Holiday Breaks and Understaffed Payment Gateway Security
During the holiday season, many businesses operate with reduced staff, including their cybersecurity teams. This staffing shortage can leave payment gateway operations and systems vulnerable to attacks. Mobile payment solutions and digital wallets, in particular, are susceptible to risks like credit risk fraud and money laundering. Criminals exploit the understaffed security to engage in fraudulent transactions and financial crimes.
Irresistible Holiday Shopping Promotions
Holiday shoppers are often enticed by too-good-to-be-true promotions and offers. As a result, they fall victim to scams that offer unbelievable deals. The fear of missing out on these offers makes it hard for consumers to reject them, creating the perfect opportunity for scammers to thrive.
Leveraging Advanced Technologies to Combat Holiday Scams
In the battle against holiday scams, technology is a powerful ally. Mobile payment and mobile money service providers can employ proactive measures to secure their revenue and protect their customers.
Neural Technologies’s Revenue Protection suite of solutions can help mitigate the risks associated with the holiday season.
Our advanced Fraud Management solution harnesses the power of AI and machine learning technology to swiftly detect and pinpoint fraudulent activities, providing businesses with real-time protection against an extensive array of holiday scams, including both conventional and emerging fraudulent schemes.
Credit Risk Management solution is specifically crafted to offer comprehensive credit risk assessment throughout the entire spectrum of mobile payment operations, encompassing aspects like forecasting bad debt, predicting usage patterns, and detecting anomalies.
It employs advanced techniques, including time-series decomposition and behavioral analysis, to identify and highlight critical credit risk in the context of mobile money solutions, especially during the holiday season when vulnerabilities are heightened.
In the context of mobile money-related financial crimes, our Anti-Money Laundering solution offers simplified onboarding with automated KYC/AML risk assessment, streamlining the entire customer journey. The solution covers everything from the initial customer onboarding process to ensuring compliance with AML/CTF regulations, which is especially vital given the surge in criminal activities during holiday seasons.