Fraud techniques and detection methods

Fraud Techniques

In the modern society, many organizations across various industries are increasingly vulnerable to electronic fraud. The threat of electronic fraud across these industries is particularly worsened with the emergence of computer fraud. Actually, computer fraud and crime has continued to be a major concern in the recent past since computer processing can evade the conventional security and control measures. However, computer fraud doesn't necessarily involve the use of micro-computers as it just makes electronic fraud and computer crime easier. The threat of electronic fraud is also a major concern across various industries because modern technology offers fraudsters with powerful new cracking tools for electronic safe. Notably, these crimes can be severe since electronic fraud can take place for extended periods before discovery, which in turn results in considerable losses and damages.

Forms of Fraud Techniques:

Since fraud is undoubtedly not a new concept and did not emerge with the beginning of the Internet, fraudulent activities are much easier to penetrate on the Internet. This is mainly because the widespread access to the Internet has provided many criminals with increased access to victims and a relatively wider area to perpetrate the offenses (Easttom & Taylor, 2011, p. 184). There are various common fraud techniques that have emerged in the recent past such as:

Auction Frauds:

Auctions have developed as one of the major areas through which the Internet has significantly expanded crime opportunities. This is mainly through the emergence of online auctions that has significantly changed the conventional process of bidding. Unlike conventional auctions where an individual would bid for an item in person, online auctions do not involve bidding in person. This has in turn contributed to the rise in auction frauds that can occur through failure to deliver the merchandise, sending items of lesser value than those advertised, and the failure to reveal all relevant information regarding the item or terms of sale. In addition, there are other areas of online frauds that include shill bidding to drive up an item's price, bid shielding involving very high bids that discourage other bidders, and bid siphoning that involves luring bidders off legal auction sites.

Investment Offers:

The second major form of fraud techniques are investment offers that have developed to become a very pervasive problem. While this fraud is not a new technique as some are legal, it mainly depends on the natural greed of the victim. In most case, investment offers usually occur with total strangers trusting other with huge sums of money. As a result, the incidents tend to be difficult to investigate because they are usually perpetrated by anonymous rented mailboxes and e-mail accounts that are mostly conducted from overseas. The other form of investment offers fraud that is usually not so blatant is investment advice that involves the provision of false and biased stock advice in exchange of compensation for the opinion.

The Threat of Cyber Terrorism to the Society:

Since there are relatively minimal arguments against the threat of cyber terrorism, this form of crime remains as one of the worse kinds of terrorism in various societies today. Generally, cyber terrorism that basically involves cyber attacks on network security and information continues to pose complex challenges and difficulties that get into new areas for national security and public policy (Lewis, 2002). Generally, cyber terrorism involves the use of computer systems and tools to shut down vital national infrastructures. This kind of crime is mainly carried out to coerce or intimidate a civilian population or government.

Cyber terrorism poses significant threats to the society since nations and critical infrastructures have become increasingly dependent on computer systems for their operations. As a result, new vulnerabilities are created by the dependence on computer systems that provide more opportunities for cyber attacks. Actually, a hostile group or nation can exploit the vulnerabilities to infiltrate a poorly secured computer networks and interrupt or even blackout critical functions. An example of the threat cyber terrorism poses to the society is the fact that power companies have increasingly become a major target for basic attacks and the fact that 70% of these firms experienced a severe cyber attack in the first half of 2002.

Trials against Computer Fraud Offenders:

In the battle against computer crime, the observation, collection, documentation, and preservation of electronic or digital evidence is an important part in solving such crimes. One of the most important aspect is prosecuting suspected criminals of computer crime effectively is preservation of evidence. Law enforcement personnel and agencies are required to properly preserve electronic or digital evidence to make it appropriate in court (Cameron, 2011). While the techniques for collecting and preserving such evidence may vary based on the kind of technology used, there are various critical steps that officers should put in place. First, the law enforcement personnel should have secure storage location and enough back-up copies since lost evidence hinders successful prosecutions. Secondly, these officers must ensure that the long-term integrity of the evidence is maintained through preventing alliterations of the data. This may involve transferring the electronic information onto non-rewritable storage devices.