Social engineering is a real threat

KARACHI:

Experts and regulators in the banking sector have called for widespread awareness and technological solutions among customers and locals about social engineering fraud in the digital age to curb it. They made this call while addressing the participants of a one-day conference titled “Financial Crime in the Digital Age”—looking at the growing threats of fraud and money laundering organized by Eastnets in association with Dellsons Associates held at a local hotel in Karachi on Saturday.

“If someone is running for president of this country, don’t take calls, don’t answer, don’t answer, don’t say a word. Pakistan is probably one of the few countries that has amazing documents for identification – like CNIC – that has a unique number. I have been exposed to an amazing variety of scams in the last six months. We are not letting the system work properly,” said federal banking ombudsman Sirajuddin Aziz.

He stated that technological solutions and customer awareness are two critical aspects to combat the increasing incidents of financial crimes across the country. He stressed that banks should continue to upgrade their systems to strengthen the security of their customers’ data, as well as introduce reforms to close the gaps in practices and mechanisms that make customer data accessible to white-collar criminals.

Sharing cases of victims, he said that victims of financial crimes in Pakistan are highly qualified, ironically, compared to fraudsters who are less educated but regular in tricking the public into providing their credentials to steal money from bank accounts.

Delivering a presentation on ‘Unmasking the threat: Exploring social engineering in digital fraud’, Planet N Group of Companies founder and trainer Nadeem Hussain said, “We need to help educate local people about social engineering scams. When my team and I started EasyPaisa 11 years ago, the most common transaction that gained popularity with EasyPaisa was domestic remittances. You could go to a grocery store, give the beneficiary’s CNIC, phone number and a six-digit password to collect the amount. Indeed, it was the first economic revolution in Pakistan, as this domestic remittance product revolution changed the behavior of millions of people.”

He emphasized that online transactions go beyond paper [transactions] such as checks etc. He called for customer awareness about digital fraud as digital banks face cyber crime, hacking and financial fraud.

Financial Monitoring Unit (FMU) Director General Lubna Farooq Malik said that FMU is a specialized agency that takes care of collecting financial information from various reporting entities including banks, insurance companies, non-bank financial companies, microfinance banks, exchange companies and specified businesses such as real estate providers, jewelers and accounting firms, as the network of reporting entities is very high.

Reading: PHONE SCAMS TO DATA LEAKS: SECURING PAKISTAN’S DIGITAL BORDERS

He stated that whenever financial transactions take place, these [entities] reference to FMU based on two criteria. First, any transactions worth Rs 2 million or above that are made in cash are reported to the FMU as a cash transaction report and secondly, the suspicious transactions (STR), which means if a bank is suspicious of any amount or transactions of zero amount, bank) report to FMU as it is not as simple as it seems.

He added that over time, banks have developed a lot of capacity in terms of the STR system. However, the challenges never end at this time. “When it comes to digital crimes, we have many databases such as the police, the Federal Investigation Agency (FIA), the Federal Bureau of Revenue (FBR) and others to analyze transactions based on suspicions or reports or queries from reporting entities or law enforcement agencies (LAE). We have also formulated the financial information, which is a type of report submitted to the concerned LAEs. We also support the investigation process. Despite the painstaking efforts and tasks, there is always room for improvement. Today, we have partnerships with important countries like the UAE and South Africa, etc., helping LAEs investigate someone in a better way,” he said.

“The volume of cyber attacks worldwide more than doubled last year. Cybercrime is estimated to cost the world $6 trillion annually. The growth of instant payments and real-time transactions has led financial services companies to implement Artificial Intelligence (AI) solutions based on real-time data that cannot be handled by human intelligence alone,” said the founder and CEO Eastnets consultant Hazem Mulhim.

He highlighted that Pakistan is an emerging and important market for the financial sector, which keeps its system updated with advanced technological solutions to maintain its position on the Financial Action Task Force (FATF) whitelist.

Published in The Express Tribune, November 26^u2023.

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