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Archive for the ‘Uncategorized’ Category

Phone Security Issues

17
May

Call centers in healthcare and insurance industries are often utilized in stressful or unpleasant times concerning complicated issues. However, these providers have limited security measures to determine whether the person they are talking to is the actual policyholder or patient, thus making these industries susceptible to phone fraud. Insurance agencies experienced a massive increase in fraudulent calls, as in 2016, one in every 4,700 calls was fraudulent compared to 1 in 12,000 in 2015.

Do you know who’s really calling?

Traditional authentication methods of corroborating phone numbers with caller ID, using knowledge-based authentication (KBA) questions or voice biometrics can be easily spoofed or bypassed by fraudsters, granting them access to sensitive information. For example, in efforts of providing seamless customer service, call center agents can be manipulated by social engineering, as fraudsters phish for information regarding health records, policy or account credentials, or other confidential histories. The data can then be used to make false claims and takeover accounts.

Healthcare

A significant level of scrutiny is placed upon the healthcare industry with regards to patient privacy. Due to the level of detail within patient records, fraudsters will leverage aggressive tactics for data mining. Healthcare providers may encounter attacks including data breach, chargebacks, or flex spending account takeovers. With these fraud attacks, health records could be leaked to the black market, putting patients’ information in jeopardy. However, compared to financial institutions and retailers, healthcare providers experience a disadvantage because they typically do not have call center security in place to deter fraud.

Insurance

There are a variety of scams aimed at insurance companies by phone fraud rings, and victims may not notice for a long time, if ever. Account takeovers originate in the call center, and can go unnoticed for months or potentially years, due to customer account inactivity. Insurance agencies often encounter impersonation fraud, where fraudsters file false claims. The life insurance policies targeted by fraudsters typically have high cash values, which can then be liquidated or used as an investment vehicle.

Even though life and auto insurance provide high pay offs, device insurance is by far the most common. Some device companies offer payments to consumers whose mobile phones are lost or stolen, resulting in 1 in every 194 calls being fraudulent.

The Hidden Costs

Cybersecurity is continually being enhanced within most organizations, however, the phone channel remains the weakest link and criminals can often bypass inefficient security measures during their attacks. Fraud found within the healthcare and insurance industries come with different costs, the most obvious being the monetary loss, however, other hidden costs must be considered: identity theft, poor patient experience, fraudulent claims, cross-channel attacks, and brand reputation.

Learn More

10
May

Throughout 2016, Pindrop analyzed more 700 million phone calls many of them coming from companies that receive more than 40 million calls per year. Phone fraud has increased 113% cross-industry from 1 in every 2,000 calls in 2015 to 1 in every 937 calls in 2016. While all industries are experiencing increased fraud rates, retail stands out with  1 in every 491 incoming calls being fraudulent a dramatic increase from 1 in every 1000 for 2015. This number exceeds the amount of calls coming into the call centers of credit card issuers, banks, and insurance companies 1 in 832, 1 in 867, and 1 in 4,700, respectively.

“It’s a wild west out there,” says David Dewey, Director of Research at Pindrop.

Why is retail being targeted?

Retailers’ existing security systems are not robust or secure enough to handle the increasing volume of data filtering across web-enabled devices and processes. A digitally-influenced retail experience may enable brands to conduct business from a variety of access points, but it also allows criminals to take a multi-faceted approach to acquiring customer data.

Why are fraudsters redirecting their attacks to the call center?

With the rollout of EMV technology and improved security measures online, fraudsters have redirected their attacks to the phone channel the weakest link in security. Call center agents often fall victim to these attacks because they are focused on administering quality customer service rather than detecting and preventing fraud. 61% of fraud can be traced back to the call center. The root cause of fraud loss, the call center, is often misdiagnosed by retailers, enabling fraud in other channels, such as debit card, credit card, and check order takeover online fraud that occurs as soon as credentials are reset by call center agents.

Organized fraud rings use information acquired from data breaches and social websites to successfully impersonate customers and get through security questions. Because these questions are designed to allow legitimate users to easily access their accounts, call center agents don’t immediately assume these are illegitimate callers. On average, these fraudsters call in five times attempting to make changes to a victim’s account, such as the associated email address or physical address, in order to gain control.

Fraudsters are also getting better at hiding their identity phone number, location, and device type. By using prepaid phone cards, Skype or Google Voice calls, or by taking over someone’s home VoIP system, their phonecalls can be masked to look like they originate from a customer’s home. In the United States, 83% of fraudulent calls originate overseas.

What is the most common approach fraudsters are taking in the retail space?

For retailers, chargeback fraud is the most common approach that criminals take. This occurs when a criminal calls a retailer to make a fraudulent purchase using a victim’s identity and card information, then having the product shipped to a different physical address. Retailers in the United States lost $60 billion to fraud in 2015 mostly due to chargeback fraud coming from card-not-present (CNP) transactions. Fraud loss for retailers now averages $3.4 million annually.

Learn more

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08
Mar

Retail is now the number one target for cyberattacks. Because retailers hold large volumes of highly distributed personal information, including credit card data, these organizations are attractive environments for fraudsters to breach. In 2015, $60 billion was lost to retailers in the United States due to fraudulent activity.

The phone channel is the weakest link in information security. Sixty-one percent of fraud can be traced back to the call center. This vulnerability enables fraud in other channels, such as debit card, credit card, and check order takeover — online fraud that occurs quickly and easily as soon as fraudsters convince call center agents to reset a victim’s credentials through social engineering.

Call center fraud in the retail space is an urgent problem.

-One out of every 1000 calls into retail call centers is fraud-related.
-One out of every 300 calls related to “fencible” retail products, which are easily sold on the black market, is a fraud-related call.
-Fraud loss for retailers averages $3.4 million annually.

Fraud loss is mostly due to card-not-present (CNP) fraud, which has increased since the US transition to EMV technology. Fraudsters place orders using stolen credit card credentials, not only costing the retailer the price of the stolen merchandise, but also raising operational costs and increasing chargeback fees. According to Aite Group, an independent research firm, 72% of executives expect call center fraud loss to continue to grow, with $4 billion in counterfeit card fraud moving into the phone channel.

MRC Vegas is the largest global event focused on payments, fraud, cybersecurity and risk for connected commerce at the intersection of mobile, retail, marketing services, data and technology with more than 1500 attendees, including over 450 companies from over 30 countries. This year, Shawn Hall, Director of Fraud Strategy and Operations, will be presenting on the data breach butterfly effect that occurs across physical, online, and phone channels.

Join us!

 

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07
Mar

PSCU, the nation’s leading credit union service organization, has partnered with Pindrop to identify and prevent call center authentication fraud. Call center fraud occurs when criminals use the phone channel to impersonate consumers to gain access to their account funds and sensitive data. PSCU is the first credit union service provider to utilize Pindrop’s proprietary platform for fighting call center authentication fraud.

“Through our partnership with Pindrop, PSCU continues to protect members by investing in risk management and advanced fraud detection solutions aimed at driving down fraud losses and improving the member’s identity authentication experience,” said Chuck Fagan, PSCU President and CEO. “The technology from Pindrop adds yet another layer of security and intelligence to our industry-leading risk management protocol to detect and prevent fraud.”

“PSCU’s fraud detection and prevention resources stopped $146 million in fraudulent transactions last year,” said Jack Lynch, PSCU SVP and Chief Risk Officer. “The partnership with Pindrop will help toughen our resistance to this emerging fraud threat in the voice channel. Our investment in new risk management technology is a key component of PSCU’s mission to support, protect and optimize every transaction we have with our Owner’s members.”

“We are excited about the partnership and we look forward to supporting PSCU’s commitment to service excellence by protecting their Owners and members against the increasing fraud threats that target call centers,” said Michael Hughes, Pindrop Vice President, Americas. “Over 61 percent of fraud starts with a phone call and the voice channel accounted for more than $10 billion in fraud last year in the U.S. PSCU is a proven leader in fraud and risk management best practices and we are proud to have the Pindrop technology as an integral component of their overall member authentication and risk management strategy.”

Pindrop’s patented technology, Phoneprinting™, analyzes 147 different factors in the audio of a phone call in order to create a unique signature that allows a fraud analyst to identify an illegitimate caller, while also determining the caller’s true geographic location, device type, and more. Unlike a phone number or a voice, this information is impossible for fraudsters manipulate. With Pindrop’s solution, customers catch over 80% of fraud calls with less than a 1% false positive rate. Contact centers are empowered with the technology necessary to stop fraud loss, reduce operations costs, protect brand reputation and compliance, and improve the customer’s overall experience.

According to Aite’s Senior Analyst, Shirley Inscoe, as large financial institutions implement anti-fraud and authentication technology like Phoneprinting™,  fraudsters will move downstream and target smaller organizations, such as smaller banks and credit unions. With Pindrop, PSCU will be able to streamline the member authentication experience to enable faster issue resolution time through the voice channel. “Our Owners expect our call centers to protect them from fraudulent callers, and we must implement solutions that quickly and accurately validate incoming calls,” added Lynch. “Pindrop’s technology will help us add even more value to our fraud protection services and improve the overall member experience.”

About PSCU

Established in 1977, PSCU (St. Petersburg, FL) is the nation’s leading credit union service organization (CUSO). The company was recognized as CUSO of the Year in 2016 by the National Association of Credit Union Service Organizations. PSCU’s products, financial services solutions and service model collectively support over 850 Owner credit unions representing more than 20 million credit, debit, prepaid, online bill payment and mobile accounts; protect over 2 billion transactions annually from fraud; and optimize credit union performance and growth. Comprehensive 24/7/365 member support is delivered through call centers located throughout the United States.

About Pindrop

Pindrop is the pioneer in voice security and authentication. Pindrop provides enterprise solutions to reduce fraud losses and authentication expense for some of the largest call centers in the world. Pindrop’s patented Phoneprinting™ technology helps identify, locate and authenticate phone devices uniquely from the call audio, thereby detecting fraudulent calls as well as verifying legitimate callers. Pindrop has been selected by the world’s largest banks, insurers, brokerages and retailers, detecting over 80 percent of fraud. Pindrop’s solutions are allowing customers to reduce call time and improve their customer’s experience even while reducing fraud losses. Pindrop was founded in 2011 and is venture backed by Andreessen Horowitz, CapitalG, Citi Ventures, Felicis Ventures, GV and IVP.

Learn more.

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28
Dec

Contact center fraud loss is expected to double from $393M to $775M by 2020. Despite the intent to administer positive and timely customer experiences, contact centers agents often fall victim to the social engineering methods that enable fraud attacks. Fraud attacks increase operational costs, decrease customer satisfaction, and jeopardize brand reputation as customer data is repeatedly lost to fraud. With 61% of account takeovers traced back to the contact center, this $400 million problem needs immediate resolve.

What do enterprises need in a contact center fraud solution?

To prevent fraud loss and preserve brand reputation, enterprises need a solution that provides:

  • High Coverage. Every incoming call needs to be screened. Fraudsters must be identified on their first call to prevent them from being able to enroll as illegitimate customers.
  • High Accuracy. The right solution accurately differentiates between legitimate and illegitimate customers, detecting fraud with a low false positive rate.
  • Foolproof Technology. Fraudsters are currently using voice spoofing, voice distortion, social engineering, and more. The right solution provides resilience against attempts to break through traditional security measures.

To reduce operations cost and improve customer experience, enterprises need a solution that provides:

  • High Speed. Contact center agents must be able to handle calls quickly while also being informed about the legitimacy of callers before they provide access to personal data. Reducing authentication time by one second leads to $1 million in annual savings.
  • Low Friction. Customers want security without being inconvenienced for it.

Pindrop’s patented technology, Phoneprinting™, analyzes 147 different factors in the audio of a phone call in order to create a unique signature that allows a fraud analyst to identify an illegitimate caller, while also determining the caller’s true geographic location, device type, and more. Unlike a phone number or a voice, this information is impossible for fraudsters manipulate. With Pindrop’s solution, customers catch over 80% of fraud calls with less than a 1% false positive rate. Contact centers are empowered with the technology necessary to stop fraud loss, reduce operations costs, protect brand reputation and compliance, and improve the customer’s overall experience.

According to a recent survey of 25 executives at 18 of the 40 largest US financial institutions, Phoneprinting™ is the highest ranked contact center anti-fraud solution. Avivah Litan, VP Distinguished Analyst at Gartner, explains that phoneprinting technology combined with voice biometrics is “the strongest method for detecting fraudsters who call into enterprises,” benefitting both contact center agents and security teams.

Learn more.

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30
Nov

Aite Group, an independent research and advisory firm focused on business, technology, and regulatory issues, interviewed 25 executives at 18 of the top 40 largest U.S. financial institutions based on asset size in order to provide an evaluation of the current state of fraud. New research proves that contact centers are being attacked more than ever before. Aite’s Senior Analyst, Shirley Inscoe, joined Pindrop’s Director of Research, Dr. David Dewey, to discuss the growing threat of fraud in the contact center during this session.

With the rollout of EMV chip cards, fraudsters have redirected their attacks to the contact center for data mining and account takeover. Sixty-one percent of fraud can be traced back to the contact center, but it doesn’t end there – fraud is a cross-channel problem. Many enterprises fail to identify the contact center as the root cause of fraud loss, enabling fraud in others channels, such as debit card, credit card, and check order takeover. Meanwhile, fraudsters are capitalizing on this misdiagnosis and targeting the contact center as the weakest link in security.

Contact center fraud loss is expected to double from $393M to $775M by 2020. As chip cards continue to gain momentum in the United States, organized fraud rings will continue targeting the phone channel, replacing traditional counterfeit card fraud. Current authentication factors in the contact center often fail due to the data fraudsters acquire through social engineering tactics in order to reset account credentials. Armed with data, organized fraud rings probe agents at enterprises for the information they need to access customer funds, and the point of least resistance is often the contact center.

Organized fraud rings are using automated attacks, specifically robotic fraudsters, targeting interactive voice recordings (IVRs), to keep their cost down while still managing to dramatically increase market coverage. Despite the intent to administer positive and timely customer experiences, contact centers agents often fall victim to the social engineering methods that enable fraud attacks. Fraud attacks increase operational costs, decrease customer satisfaction, and jeopardize brand reputation as customer data is repeatedly lost to fraud. Contact centers will continue to enable cross-channel fraud until technology solutions are implemented to thwart it.

Catch the on-demand session of September’s webinar now.

10
Nov

Analysts at Aite Group have identified five key security and service steps that legacy solutions are failing to perform. These are the features that are keeping Caller ID, KBA, and voice biometrics from being viable anti-fraud and authentication solutions for the contact center. With 61% of account takeovers traced back to the contact center, this $400 million problem needs immediate resolve.

Protecting personal data in the contact center relies on a best-in-class security solution that benefits both the organization and the customer through:

  1. Universal Coverage. Customers must be authenticated and fraudsters must be identified on their first call. This prevents fraudsters from being able to enroll as illegitimate customers and alleviates customer privacy concerns.
  2. Accuracy. The right solution accurately differentiates between legitimate and illegitimate customers. Legacy solutions, such as Caller ID verification and KBA, fail to provide the accuracy needed.
  3. Speed. Contact center agents must be informed about the legitimacy of callers before they provide access to personal data. KBA takes a long time, which frustrates legitimate customers and offers fraudsters many chances to collect data.
  4. Low Friction. Customers want service that requires little effort on their part. Most voice biometrics solutions require an enrollment process, which leads to longer call times and lower customer satisfaction.
  5. Foolproof Technology. Fraudsters are currently using voice distortion, spoofing, social engineering, gateway hacking, and more to circumvent traditional security measures. The right solution needs to withstand these attempts to break through protection.

How do the largest global contact centers stop fraud and protect their customers?

According to a recent survey of 25 executives at 18 of the 40 largest US financial institutions, Phoneprinting is the highest ranked contact center anti-fraud solution. Pindrop’s patented technology analyzes 147 different factors in the audio of a phone call in order to create a unique signature that allows contact centers to accurately detect fraud. Avivah Litan, VP Distinguished Analyst at Gartner, describes phoneprinting technology and voice biometrics as “complementary technologies” that mutually benefit both contact center agents and security teams. This phoneprint allows a fraud analyst to create a unique signature for an illegitimate caller, while also determining the caller’s true geographic location, device type, and more. Unlike a phone number or a voice, this information is impossible for fraudsters manipulate. Phoneprinting allows Pindrop’s customers to catch over 80% of fraud calls with less than a 1% false positive rate.

Phoneprinting provides universal protection for all incoming calls to the contact center, allowing contact center agents to identify unknown attackers on their very first call while also creating a robust intelligent blacklist of known attackers. Contact centers are empowered with the technology necessary to stop fraud loss, reduce operations costs, protect brand reputation and compliance, and improve the customer’s overall experience.

Join Pindrop’s Director of Research, Dr. David Dewey, on November 15 to learn more about how Phoneprinting helps the largest global contact centers protect customers and fight fraud.

 

05
Aug

Congratulations are in order if you’ve never had to experience the pleasure of being robocalled. The rampant growth of the underground phone fraud world is affecting consumers and enterprises alike. As consumers, we may experience calls telling us we are being sued by the IRS (just one of the many scams) and for enterprises, the call centers are a point of entry for costly phone phishing attacks. This shockingly small group of fraudsters are causing explosive amounts of damage, costing Americans about $7.4 billion annually, as noted by the Harris poll.

We can try to register for the Do Not Call lists and be more aware of the unfamiliar numbers calling us, but cyber criminals can easily access our data through social engineering, spoofing and inexpensive data downloads. Enterprises face a bigger challenge. Some have fraud ops teams to help deter or mitigate the risks. However, more and more fraudsters are targeting unprotected call centers. The advancement and rollout of EMV cards are partially to blame, coupled with the amount of consumer data that is readily available.

Our data scientist, Aude Marzuoli, presented at this year’s Black Hat conference on phone fraud scams and the phoneprinting technology to prevent such attacks. Marzouli and the research team reviewed millions of calls, while leveraging the Pindrop honeypot and online comments in combination with machine learning and were able to determine that of the 100,000 call recordings, 51% of the robocalls recorded were placed by 38 distinct telephony infrastructures which could be uniquely identified with more than 85% true detection rate (TDR) on average. So what does this all really mean? Fraudsters are getting more creative, more quickly, and within a small network have an exceptional, growing presence that makes protection from this abuse more challenging.

To learn more about the findings, check out the full Call Me: Gathering Threat Intelligence on Telephony Scams to Detect Fraud presentation.

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29
Jul

TWIPF2 This week in phone fraud, Pindrop Labs released its Top 10 Consumer Phone Scams Report and Pindrop CEO, Vijay Balasubramaniyan, reveals how deep learning can transform the relationship between humans and machines.

On Thursday, USA Today reported the top three phone scams targeting consumers this year are Google listing scams, loan-related scams and fraudsters offering free vacations, an information security company called Pindrop found — by masquerading as unsuspecting customers.

Wednesday, IT Pro Portal reported that ever since humans evolved language, speech has proven to be the most efficient way for us to communicate, from the simplest requests to the most complex ideas. Now, with advances in technology, speech is poised to become the next major transformation of the user interface.

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Biometric Update: Biometrics alone will not win the authentication wars – Hackers target banks and any business with a digital presence to steal people’s identities and export valuable private information. Increasingly, hackers are using impersonation methods to pose as individuals to commit fraud digitally and over the phone. Especially in the call center, where fraud is expected to grow by 97 percent between 2015-20 (Aite Group)

Helpnet Security: As voice interaction increases, what will security look like in the next 5 years? – As the accuracy of voice UI grows, it will naturally progress to a means of authentication in the enterprise. However, the enterprise should be concerned about the security implications of tomorrow and what managing voice authentication, in the daily work environment, will mean.

On the Wire: Google Listing, Political Scams, Top Phone Fraud Threats – Nearly 20 percent of all phone fraud calls hitting consumers and businesses this year are part of the fake Google listing scam, more than twice as many as the eight percent that are loan scam calls, according to new data released by Pindrop Labs.

New York Post: Why you may fall for these wild scam phone calls – About 896,000 scam calls have been reported to the US Treasury Inspector General for Tax Administration’s office since October 2013, with some 5,000 victims paying more than $29.5 million to robbers, the agency’s head reported earlier this year.

National Daily Press: FCC is putting pressure on phone companies to give customers technology to block robocalls – The FCC is putting new pressure on both wireless carriers and traditional phone companies to give customers technology to block unwanted robocalls. Chairman Tom Wheeler has told the carriers that they need to give their customers the option to block robocalls, which have become the largest source of complaints that the commission receives.

Straits Times: Banks “unlikely” to pay phone scam victims – Last Monday, OCBC Bank reported a sharp rise in scams involving conmen impersonating its employees; around 30 customers are believed to have been duped, losing tens of thousands of dollars. However, lawyers say victims would be liable for the money they lost due to the voluntary nature of the transactions.

22
Jul

TWIPF2 This week in phone fraud, a researcher found a way to trick the ID verification tools used by tech giants Microsoft, Google, and Instagram, and a phone scam in China targets HIV infected people.

On Thursday, Fortune reported that a researcher found a simple yet ingenious way to trick three companies— Microsoft, Google, and Facebook’s Instagram—into forking over money using nothing more than the telephone.

Thursday, New York Times reported that hundreds of people with H.I.V. across China are being called by someone who claiming to be from the government who has access to their medical records and other personal information.

newsletter-banner

NPR: Scammers Turn To Caller ID “Spoofing” To Pose as Police – Most people know to hang up on con artists supposedly calling from the power company or the IRS, demanding money. The problem is, there’s little the police can do — even when the scammers go so far as to impersonate the police themselves.

Shanghai Daily: Police in China to probe suspected phone scam targeting people with HIV – People with HIV nationwide have reportedly received phone calls from individuals claiming to work for the government. The callers allegedly attempt to collect service fees for “government subsidies for the HIV-infected.”

IT Pro Portal: Modernise your authentication methods of suffer the consequences – The way digital enterprises connect with their customers is changing. Consumers are demanding more trusted and personalised experiences in exchange for their personally identifiable information (PII), while businesses are struggling to protect user privacy in light of growing global security and privacy concerns.

Huffington Post Canada: Canada Revenue Agency Scam hits 17 in Saskatchewan, RCMP say – Seventeen individuals in Saskatchewan have been a victim to the Canada Revenue Agency fraud with nearly $70,000 in reported losses since the beginning of 2016. Fraudsters threaten arrest, legal action, seizure of homes, vehicles and other assets if payment isn’t made.

Komando: New way fraudsters are spoofing victims – Robocalls are automated phone calls with prerecorded messages usually used for political campaigns and marketing purposes. But due to the proliferation of cheap phone software and technology, scammers are getting their hands down and dirty with this fast and easy method of conning people out of their cash

Bucks Free Press: Scam Alert: Fraudsters impersonate phone companies to and trick people into sharing details – Fraudsters are impersonating phone companies in a bid to trick people into handing over their personal details. They attempt to glean personal and financial details which will then be used to contact genuine phone companies and order new mobile phones. They will then either intercept the delivery before it reaches the victim’s address or order the handset to a different address.

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