"Criminals do not shy away from crossing hefty boundaries in their money laundering practices." It's the harsh conclusion drawn by KYC expert Fourthline based on data from millions of checks the fintech conducted.
Almost half (47%) of detected financial fraud attempts in Europe involve so-called "social engineering. Here, especially the elderly and young are abused by criminals to open bank accounts for criminal purposes, for example. With an increase of no less than 19%, Fourthline speaks of a dangerous trend.
Social engineering is an umbrella term for what criminals do to abuse a person's trust. For example, an individual legitimately opens a bank account but then hands over the login information to a criminal. This can happen under pressure, but also without the person being aware of it.
According to Fourthline, the elderly and young people with socioeconomic disadvantages in particular are targeted by criminals in order to still have legal bank accounts. When fraud is actually committed through such an account, it is referred to as "money muling.
Fourthline explains what such a process looks like. According to the KYC expertise firm, contact is often made through social media, but it is also not uncommon for phone or "real-life" contact to be made. "We see this happen regularly with the elderly, because this group has less knowledge of technology and is therefore more likely to seek outside help. Chances are they are unaware that a bank account is created through a simple selfie."
"Also, 'account takeover fraud' generally happens more with seniors who unknowingly give away their information," Fourthline continued. "In the case of account takeover fraud, a bank account has already been created and the takeover of the account happens after onboarding. In addition, youth with socioeconomic disadvantages are also a sought-after target of criminals. This group of youth is offered money or other nice promises in exchange for a (new) bank account."
This is not the first time Fourthline has disclosed such "fraud figures. Recently, the KYC expert also revealed figures regarding the use of silicone masks and deepfakes to open a bank account. At the time, Fourthline CEO Krik Gunning stated that criminals are becoming increasingly inventive in gaining access to the financial ecosystem.
"It is important for a society that crime does not pay. It is worrying that ignorant individuals are now being targeted by criminals in order to launder their criminal money. This is where we need to be even sharper with financial institutions to protect vulnerable groups and thus potential victims."
