Tag: fraud

Posted in technology

When Your Last $166 Vanishes: ‘Fast Fraud’ Surges on Payment Apps

Charee Mobley, who teaches middle school in Fort Worth, Texas, had just $166 to get herself and her 17-year-old daughter through the last two weeks of August.

But that money disappeared when Ms. Mobley, 37, ran into an issue with Square’s Cash App, an instant payments app that she was using in the coronavirus pandemic to pay her bills and do her banking.

After seeing an errant online shopping charge on her Cash App, Ms. Mobley called what she thought was a help line for it. But the line had been set up by someone who asked her to download some software, which then took control of the app and drained her account.

“I didn’t have gas money and I couldn’t pay my daughter’s senior dues,” Ms. Mobley said. “We basically just had to stick it out until I got paid the following week.”

In the pandemic, people have flocked to instant payment apps like Cash App, PayPal’s Venmo and Zelle as they have wanted to avoid retail bank branches and online commerce has become more ingrained. To encourage that shift, the payment apps have added services like debit cards and routing numbers so that they work more like traditional banks.

But many people are unaware of how vulnerable they can be to losses when they use these services in place of banks. Payment apps have long had fraud rates that are three to four times higher than traditional payment methods such as credit and debit cards, according to data from the security firms Sift and Chargeback Gurus.

The fraud appears to have surged in recent months as more people use the apps. At Venmo, daily users have grown by 26 percent since last year, while the number of customer reviews mentioning the words fraud or scam has risen nearly

Posted in technology

Fraud claims, DOJ probe and sexual abuse allegations cloud $2B deal between GM and Nikola truck startup

What seemed like a simple matter of crossing the t’s and dotting the i’s has turned into a protracted challenge for General Motors and Nikola, after negotiations to pair up and produce new zero-emissions trucks have been extended.

The $2 billion deal, announced Sept. 9, was billed as a “partnership made in heaven,” according to Nikola founder and then-chairman Trevor Milton, during a media call with GM CEO Mary Barra. But the Phoenix-based startup has since been hammered by claims of fraud, with a Securities and Exchange Commission probe now underway. Allegations surfaced this week of sexual abuse by Milton, who stepped down as chairman last week. Nikola’s stock has plunged to barely a quarter of what it was worth when the company went public last June.

Talks expected to wrap up today could now run through Dec. 3, at which time the proposed deal “may be terminated by either (Nikola) or GM Holdings if the closing has not occurred,” according to a Nikola filing with the SEC.

“Nikola continues to work with GM towards a closing and will provide further updates when appropriate or required,” a Nikola spokesperson said in a statement sent to NBC News and echoed by GM. Separately, the startup issued a statement outlining its various business ventures, an apparent response to Wall Street’s growing concerns about the company.

Describing itself as a “a technology disruptor and integrator” aimed at becoming a “global leader,” it emphasized that it has a number of other ventures in the works, including a deal with European truck maker Iveco, while it is moving ahead on the launch of a factory in Arizona that will produce its heavy-duty hydrogen trucks.

Founded in Salt Lake City in 2014, Nikola Motors planned to produce large semi-trucks using fuel cells, rather than conventional diesel

Posted in technology

Account takeover fraud rates skyrocketed 282% over last year

ATO is the weapon of choice for fraudsters leading up to the holiday shopping season, new data from Sift shows, and consumers place account security burden on businesses.

Lock on enter key

Image: iStock/Stock Depot

Account takeover (ATO) fraud attempts to steal from consumers and e-commerce merchants swelled 282% between Q2 2019 to Q2 2020, new data from digital trust and safety provider Sift finds. The ATO rate is the ratio of attempted fraudulent logins over total logins. ATO rates for physical e-commerce businesses jumped 378% since the start of the COVID-19 pandemic, Sift’s Q3 2020 Digital Trust & Safety Index found. This indicates that fraudsters are leaning heavily on this attack vector to steal payment information and rewards points stored in online accounts on merchant websites, according to the company.

SEE: Identity theft protection policy (TechRepublic Premium)

The index includes analysis from Sift’s global network of 34,000 sites and apps and from a survey of US consumers, the company said.

According to Deloitte’s annual holiday retail forecast, e-commerce sales are forecasted to grow between 25% and 35% and are expected to generate $182 billion and $196 billion this season. When combined with the surge in ATO rates, the 2020 holiday shopping season presents the perfect opportunity for fraudsters to leverage account takeovers to take advantage of more people shopping online, Sift said. “This can have a devastating impact on companies including financial repercussions and brand abandonment,” the company said.

Account hacking leads to brand abandonment

ATO attacks also create significant and lasting brand damage, Sift said. In surveying 1,000 US adult consumers, the company said it found that more than one-quarter (28%) of respondents would completely stop using a site or service if their accounts on that site were hacked.

SEE: How to combat cyber threats amid the shift to remote working (TechRepublic)