Identifying the Fraudsters - Getting to the Heart of the Matter

Written by Jen McKeeman

22 February 2021

“The challenge for capitalism is that the things that breed trust also breed the environment for fraud.”

James Surowiecki, author and journalist


Have you ever been conned into buying something you didn’t need or been scammed out of money? You come away feeling cheated and deceived; incredulous that someone would take advantage of you and annoyed that you’d fallen for it. By definition, a fraudster is someone who demonstrates criminal deception or acts in a dishonest and unfair way. Morals don’t come into it - the focus is usually financial gain. Fraudsters engage in the sale of counterfeit and grey goods (intellectual property infringement), scam and spam (e.g. phishing, pyramid schemes) and fake reviews (positive reviews to boost listings and negative reviews targeting  competitors).

The challenge with fighting fraudsters is that they are unrelenting in their pursuits. The absence of principles means anything and anyone is fair game - constantly looking for opportunities to exploit unsuspecting customers.


Profiting from pandemics

Hard times, economic crises and human vulnerabilities present fraudsters with an abundance of opportunities for unscrupulous enterprises. 

As the global Covid-19 pandemic unfolded in Europe at the start of 2020, so too a new epidemic of crime, counterfeits and scams emerged, highlighting how unscrupulous these individuals and groups can be.

According to London Trading Standards (LTS), 6.5 million substandard masks and 8,000 counterfeit hand sanitisers (branded Andrex and Comfort) were stopped at Heathrow Airport by the start of June 2020. In addition, unsafe Covid treatments, requiring the user to mix potentially toxic chemicals and rinse their mouth with it, were also seized. 

Commander Karen Baxter, City of London Police, National Coordinator of Economic Crime, said:

“Criminals will use any opportunity they can to take money from innocent people. This includes exploiting tragedies and global emergencies. As more people stay indoors and work from computers and laptops at home, there is more opportunity for criminals to try and trick people into parting with their money at a time when they are anxious and uncertain about the future. This is especially relevant as older, more vulnerable people self-isolate and may be targeted over the phone, or even in person, by despicable criminals.”

Adaptive and deceitful

Fake NHS lanyards were also uncovered - sought after to gain discounts or shopping privileges. This demonstrates how quickly fraudsters act to capitalise on situations and changing market demand.

As soon as the first Covid-19 vaccine was approved, listings of vaccines were found on the so-called ‘dark web’. Experts revealed that many of the listings were fake or would never be shipped. According to Europol, even empty vaccine vials could be targeted since they could be illegally refilled allowing scammers to make more money. Europol said counterfeit vaccines could pose a serious public health risk, ‘ineffective at best, toxic at worst.’

Counterfeit concerns

Criminals, as this is what fraudsters are, take advantage of anxieties and vulnerabilities for their financial benefit. Counterfeit is the largest criminal enterprise in the world according to Forbes, with sales from counterfeit and pirated goods totalling $1.7 trillion per year. By 2022 it is expected to grow to $2.8 trillion and cost 5.4 million jobs.

Counterfeiters have capitalised on the shortfall between supply and demand of healthcare and PPE equipment, creating a market for counterfeit alternatives online. Europol reports that over a one week period in March 2020, law enforcement authorities seized over 34,000 counterfeit surgical masks worldwide. The risk is that the ongoing pandemic perpetuates the problem of counterfeit to the detriment of trusting consumers.

Digital fingerprints and patterns

However, despite how varied and evolving the criminal schemes and deceitful scams can be, ultimately at the heart of the matter lies an amoral individual or group of individuals acting in a particular, and often predictable, pattern. Just as criminals leave physical fingerprints offline, online they also leave a trail of digital fingerprints to help identify and trace them back to their dishonest enterprises.

Pasabi spots patterns of negative behaviour - the tell-tale signs of deception

Pasabi understands the worst culprits usually work together - whether it’s groups acting as one organisation or a series of ‘bots’ (automated systems using fake accounts) being deployed alongside real users. We recognise that patterns of behaviour that are key to spotting the deception. 

We take a strategic approach to identify fraudsters using clustering and graph technology. Our platform analyses hundreds of data points across marketplaces, social media and websites to surface offenders. 

Clustering technology is a technique involving the grouping of data points. These data points range from hashtags and social post content to IP addresses and telephone numbers. Data points in the same group should have similar properties.  This data-first approach allows us to look for networks and patterns of negative behaviour in the data. 

Whether a fraudster is involved in pushing fake reviews or peddling counterfeit goods, their pattern of fraudulent behaviour can be identical. Using AI and machine learning we detect patterns of spurious behaviour and categorise each behaviour to identify intent. Pasabi’s proprietary scoring system allows us to create watchlists of the worst offenders for each category - counterfeit, unauthorised sellers, spam and scam - and surfaces evidence so that the appropriate action can be taken. This ranges from sending cease and desist letters to misbehaving companies, to banning repeat offenders from your platform or site. In doing so, we help you to tackle the scale of the challenge you face. 

In the same way that fraudsters constantly change their criminal enterprises, Pasabi too adapts to their new modus operandi and changing tactics to keep your data free from damaging and misleading content, fake accounts and listings, protecting your brand and safeguarding your customers.

If you are interested in finding out more about how we can help you fight the fakes, why not request the guide below.

Photo by Belinda Fewings on Unsplash

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