As Black Friday Approaches, Retailers are Braced for a Fraud DelugePosted: November 24, 2016 Filed under: Uncategorized | Tags: black friday, christmas shopping, e-commerce, fraud, fraud prevention, threatmetrix Leave a comment
Looking forward to Christmas? Spare a thought for the nation’s retailers, who will be battling as many as one million fraud attempts each day in the period following Black Friday, according to new estimates.
They come from ThreatMetrix, a fraud prevention company with good industry insight thanks to its Digital Identity Network platform which analyses over 20 billion transactions globally each year.
It predicted a 60% increase in fraudulent e-commerce transactions in Q4 2016 compared to the last three months of 2015.
Product and data evangelist, Rebekah Moody, told me that this time of year usually sees an uptick in activity as dodgy transactions are less likely to be spotted, because retailers loosen fraud filters to let more transactions through.
“Transaction volumes are much higher – we saw huge daily peaks for some merchants in the same period last year. This means some merchants may choose to adjust their risk tolerance to ensure that more transactions can be processed with less friction,” she explained.
Cybercriminals also jump on the fact that average basket values are usually higher in the run up to Christmas.
“Fraudsters capitalise on this by trying to sneak through higher value transactions that are less likely to flag as unusual in amongst the sea of high value transactions,” said Moody. “Last year we saw the average basket value of rejected transactions was around 70% more than the overall average. We expect this trend to be mimicked this holiday season.”
The problem is compounded by current fraud prevention technologies, many of which have problems detecting some of the more advanced techniques used by the black hats, including device and IP spoofing and automated bots.
The latter threat is increasingly prominent to the point where, during attack spikes, bot traffic exceeds legitimate user traffic, according to the company’s latest Cybercrime Report for Q3.
It has the following:
“What might begin as a simple account validation using a basic bot evolves to using a complex bot to guess unknown passwords, to a bot that masquerades as genuine human traffic to trick unsuspecting businesses.”
Another tactic which makes fraud hard to spot is when the scammer manages to trick a victim into downloading malware onto their machine.
“For example, a fraudster convinces a customer to download some remote access software after playing to their worst fears that their account is being hacked following a data breach. They pretend to be from the consumer’s bank, and reassure them that they will protect their account from the impending hack,” explained Moody.
“In actual fact they manage to take over the consumers account after the consumer has legitimately logged in.”
Because there are no unusual log-in patterns, strange locations or hacked devices to monitor, it might look like a legitimate transaction.
“The key here though is that the remote access software was suddenly enabled, and then the fraud occurred,” Moody told me. “It’s not the fact that there was remote access software installed; many consumers use this legitimately. It was the change in behaviour. Unless a fraud system is advanced enough to detect this, it could be easy to see how this technique could cause huge issues.”
The best systems work in the background, using contextual data and real-time behavioural analytics in a way that is invisible to the user. But unfortunately they’re still not the norm. According to Barclays, two thirds of retailers (64%) are confident that their digital infrastructure will cope well with the Christmas rush. But if they prioritise up-time and sales over fraud prevention, there could be some nasty surprises down the line.
Trump on Cybersecurity – Where’s the Beef?Posted: November 16, 2016 Filed under: Uncategorized | Tags: backdoor, baker Botts, china, cybesecurity, democratic, email security, encryption, ITIF, obama, patriot act, republican, san bernardino, trump, trump cyber Leave a comment
As the dust settles on Donald Trump’s extraordinary ascent to the White House, what do we know of his plans for cybersecurity? I’ve been speaking to a variety of experts for an upcoming Infosecurity Magazine feature and, believe it or not, the majority are not particularly optimistic of the future.
His official website, outlining the Trump ‘vision’ for cybersecurity, focuses on some easy wins:
- An immediate review of critical infrastructure and federal cyber “defences and vulnerabilities” by a Cyber Review Team comprised of members of the military, law enforcement and private sector
- The same team to establish “protocols and mandatory awareness training” for all federal employees
- DoJ to create Joint Task Forces to co-ordinate federal, state and local law enforcement cybersecurity responses
- Defence secretary to make recommendations on enhancing US Cyber Command
- Development of offensive cyber capabilities
Doug Henkin, litigation partner at Baker Botts, said the focus on awareness raising is a positive.
“This appears to be a good development for setting a positive tone to lead from above with respect to best practices for protecting against cybersecurity threats and is also essential for corporations seeking to ensure good cybersecurity preparedness,” he argued.
“It is essential to increase training as the new administration has recognised, while also remaining vigilant to how cyber attacks occur.”
That’s pretty much where the good news ends.
It might be too early to judge president-elect Trump on his cybersecurity credentials. But it must be remembered that, despite his bluster over ‘Crooked Hillary’ and her email blunder, his businesses were found to be a whole lot worse when it comes to security. Independent researcher Kevin Beaumont scanned publicly available records last month and found many of Trump organizations’ messaging servers are running the no-longer supported Windows Server 2003 and Internet Information Server (IIS) 6. He also found 2FA unsupported, meaning user accounts are vulnerable to password phishing or brute force attacks.
What’s more, as a briefing document from think tank the Information Technology and Innovation Foundation (ITIF) tells us, Trump has promised in the past to apply tariffs against China if it “fails to stop illegal activities” and to “adopt a zero tolerance policy on intellectual property theft.”
Given what we know about China, this is a dangerous game to play. Beijing will continue to pretend it is abiding by the agreement between presidents Obama and Xi to stop state-sponsored economic cybercrime. And that could lead to heavy reciprocal penalties on US tech firms in China, such as Apple. The state-backed Global Times has already warned China will adopt a tit-for-tat approach if Trump plays it tough.
Silicon Valley scares
Trump’s election is also a disaster for Silicon Valley. The former reality TV star has expressed support in the past for the FBI’s stance in trying to force Apple into building a backdoor to unlock the San Bernardino shooter’s phone. He even called for a ban on Apple products in response to the firm’s refusal to do so. We can therefore expect more pressure on them to undermine encryption, which would be a disaster for businesses and consumers everywhere, as well as the American tech firms themselves.
As if that weren’t enough, he’s also a big fan of the Patriot Act and will inherit a fearsome surveillance apparatus from Obama. The Democrat is already being blamed for failing to overhaul the huge encroachment on civil liberties enacted by the Bush administration. Writing in the Guardian, Freedom of the Press Foundation executive director, Trevor Timm, had this:
“What horrors are in store for us during the reign of President Trump is anyone’s guess, but he will have all the tools at his disposal to wreak havoc on our rights here at home and countless lives of those abroad. We should have seen this coming, and we should have put in place the safeguards to limit the damage.”
Let’s hope he surprises us all.