Cybercrime now leads the way in global financial fraud, finds report

28 Apr 2022

Image: © smolaw11/Stock.adobe.com

PwC Ireland said the country has seen a rise in cybercrime since the onset of the pandemic, particularly phishing and ransomware attacks.

Nearly half the companies surveyed in a global report on financial crime were found to have been victims of some form of fraud in the last two years, with a substantial increase in cybercrime seen in many countries including Ireland.

The findings have been published today (28 April) in PwC’s Global Economic Crime and Fraud Survey 2022.

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Of the companies that reported experiencing financial crime in the last 24 months, 70pc said they were victims of fraud because of Covid-19 disruptions.

The report, which surveyed 1,296 business leaders across 53 countries, found cybercrime to be the leading overall cause of fraud.

While customer fraud previously held the top position, 42pc of large businesses reported that they experienced cybercrime over the past two years, compared to 34pc experiencing customer fraud.

Among large companies with revenues exceeding $10bn, 52pc said they had experienced fraud in this period and nearly one in five reported that their most disruptive incident had a financial impact of more than $50m.

For smaller companies, 38pc said they had experienced fraud and one in four reported total impact exceeding $1m.

Ireland on ‘high alert’ for cybercrime

Pat Moran, cybersecurity and digital forensics leader at PwC Ireland, said that ongoing environmental, geopolitical and financial instability is “creating a risk landscape that is more volatile than ever”, and that can be exploited by bad actors from external fraudster groups.

“Organisations need to be more agile than ever to respond to these converging threats and adopt new approaches and technologies to predict and prevent fraud,” he said.

While there was not enough data on Ireland in the report to extract specific figures, PwC Ireland said that the country has seen increased levels of cybercrime since the onset of the pandemic, particularly phishing and ransomware attacks.

Moran said this trend could be partially attributed to an increase in remote working as well as higher levels of sophistication seen among cybercriminal groups.

“We continue to be a target for cybercriminals due to our large concentration of foreign direct investment. Although the Government has recently strengthened our national defences, we continue to be on high alert.”

While cybercrime and customer fraud were found to be the leading types of financial fraud in PwC’s survey, other emerging areas such as digital platform fraud and ESG reporting fraud were also reported to be on the rise.

Deirdre McGrath, a partner in PwC Ireland’s forensics and transaction services team, said that companies need to start thinking more creatively in the face of growing external fraud to protect themselves.

“Understanding the end-to-end lifecycle of customer-facing products, striking the proper balance between user experience and fraud controls, and having a holistic view of data will help arm businesses in the never-ending fight against fraud,” she said.

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Vish Gain is a journalist with Silicon Republic

editorial@siliconrepublic.com