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May 2023

The role of fraud examiners is vital in winning the fraud prevention war

During the recently held Southern African Fraud Prevention Services (SAFPS) Fraud Prevention Summit – which was held on 17 May – it became clear that the South African fraud landscape is increasingly risk-based, with many more consumers at risk of becoming potential victims of fraud.

“The nature of the risk is very significant,” points out Manie van Schalkwyk, SAFPS CEO, “SAFPS statistics show that identity theft has grown by more than 300% between 2021 and 2022; there was a 600% increase in scam incidents that were reported by our members in 2022 when compared to 2018, and, according to a 2021 Interpol report, South Africa tops Africa in cyber threats and is third in the world, with 230 million threats detected in 2021.”

Van Schalkwyk points out that the increasing nature of the fraud risk has made it essential to change the playing field regarding fraud prevention. “The role of fraud examiners will play an increasingly important role in our efforts to move towards a proactive approach to fraud prevention,” says Van Schalkwyk.

The current challenge
When it comes to the current fraud prevention landscape, consumers often discover that they have become a victim of fraud after the crime has been committed.
“Let me highlight a case study which is an example of the current fraud landscape. A mother wanted to upgrade her daughter’s smartphone as a surprise for her birthday. When she tried to upgrade the device, she was told by the agent that was assisting her that the device was already upgraded a week ago. When the mother asked to see the documentation regarding the upgrade, she discovered that she had become a victim of identity theft. She also discovered that the fraudsters had opened several clothing accounts in her name, which was in debt,” says Van Schalkwyk.
In this incident, the mother had to go to a police station to open a case and then deal with several debt collectors, pointing out that she was a victim of impersonation fraud and that the incident had been reported to the police.

Arming the gatekeepers
Van Schalkwyk points out that it is essential to put systems and processes in place that creates a landscape whereby a proactive approach to fraud prevention will offer consumers protection in the future.
“The role of fraud examiners cannot be understated,” says Van Schalkwyk, “consumers are not only under pressure, but they are also unaware of the level of expertise that fraudsters have. Scams and instances that lead to fraud are run by highly sophisticated syndicates that spend every waking hour developing their skills and working on delivering their modus operandi to make it seem like the consumer is not being presented with a scam. As gatekeepers within financial institutions, fraud examiners are more aware of the red flags that may indicate that the once-in-a-lifetime opportunity is, in fact, a scam or an incident that may lead to fraud. Gatekeepers must be provided with platforms
to report scams and fraud incidents, shifting friction away from consumers towards fraudsters and

A massive step forward
The SAFPS has teamed up with OneVault to develop Secure Citizen, which is proving to be a game changer in the proactive approach to fraud prevention.  Secure Citizen is a virtual platform that consumers can log onto to secure their online identity and personal information. After creating a profile, consumers are prompted to enter their ID Number.
After this, a profile photo is taken of them through a computer webcam or by the camera on a smart device. Users are then provided with the opportunity to secure their identity, which is a process
whereby Secure Citizen checks the information that the user inputted with the data that exists that was collected by the Department of Home Affairs when the user applied for their ID book or passport.

“This is a game changer from a business point of view. Secure Citizen was not only created for individuals; it was designed so businesses can log onto the portal and check whether the person
applying for credit or a smart device upgrade is who they claim to be. In addition, Secure Citizen provides fraud examiners with a potent weapon that can be used in potential fraud cases. A fraud
incident can now be stopped before damage is done,” says Van Schalkwyk.

Another essential element in the fraud examiner’s arsenal is intelligence. “Intelligence is the key to success in any war. The SAFPS has just created a platform called Yima, where users can report a fraud incident directly to the police or the fraud department of their bank or credit provider. Another functionality of the platform is that users can access information about the current popular scams being used and the personal stories of consumers who have become victims of scams or fraud. When a fraud examiner is up to date with current fraud tactics, they will identify more red flags,” says Van Schalkwyk.

A central role
Education and keeping up to date with the current tactics used by fraudsters and scammers play a central role in the annual SAFPS Fraud Prevention Summit.  “We have highlighted the important role that fraud examiners play in the fraud landscape. The participation of fraud examiners in the Fraud Prevention Summit will play a vital role in completing the protection offered to consumers. The summit does not only focus on local issues; it also features international guest speakers who highlight the current landscape they experience. Both Yima and Secure Citizen for Individuals were launched at this year’s conference, and as we have pointed out, both of these platforms can add significant value to fraud examiners,” concludes Van Schalkwyk.

SAFPS HELP-LINE: 011 867-2234