Fintech is a huge economic driver and an essential part of the global economy. Unfortunately, with the growth of fintech, we’ve also seen an increase in fraud targeting these new online services. That’s why we’re going over four types of fintech fraud that you need to look out for deception, phishing, pharming, and malware.

Deception

Deception is the most common form of fraud and can take many forms. 

For example, the scammer may pretend to be someone you know, such as a friend or family member, or they may pretend to be someone from your bank or another financial institution. 

Scammers will often use this approach because it works so well on people who are generally trusting and willing to help others.

Phishing

Phishing is a type of fraud where criminals send emails that look like they are from legitimate companies. These emails are designed to trick you into giving up your personal information or downloading malicious software onto your device. 

Phishing emails often contain links to websites that look real but aren’t associated with the company. If you receive an email asking for your password, credit card number or other sensitive information, don’t respond! 

If you’re unsure whether an email is phishing for information, contact the company directly and ask if they sent it. Most firms will never ask you to confirm details via email or a web form.

Pharming

Pharming is when a hacker redirects an Internet user to a fake website. 

The hacker can then collect unsuspecting users’ personal, credit card, and banking information. 

Pharming attacks are becoming more common because they’re easy to carry out. Plus, they can be challenging for businesses and individuals alike to detect until it’s too late. It is a prevalent form of fintech fraud that is hard to eliminate. 

Malware

Malware is a computer virus. It can be installed on your computer by clicking on a link or opening an email attachment. Afterward, it will steal information from your computer. 

Malware can also be used to steal information from your bank account. For example, malware can capture the user’s login credentials or other sensitive data when they log into their banking website.

Learn to recognize the fintech fraud types and how to prevent them from happening to you

Fintech fraud is a type of scam that can be perpetrated using various methods. Fraud can be committed by people you know or by strangers. 

It can be used against businesses or individuals, and it’s always illegal.

Users and service providers must take precautions to prevent fintech fraud attacks. Unfortunately, that is often easier said than done.

Conclusion

This article has introduced you to the four types of fintech fraud. 

The most important takeaway is that you need to know how to spot these scams before they can affect your finances.

Always be vigilant when using online services and products.