Preying on Fear, Uncertainty, and Doubt: Cyber Fraud in an Economic Downturn

I was recently involved in an investigation in which a laid-off employee retaliated against his former employer by using his knowledge of the company's IT systems to cause major slowdowns in information processing.

Disgruntled employees are nothing new to the corporate world, but a sharp rise in their numbers means nothing good for organizations. Information processing slowdowns due to fraud place undue financial pressure on an organization, which might already be feeling the pinch of the recession.

What else can go wrong from cyber attacks when the economy goes south? It's hard to tell because this is the first full-blown recession to occur in the Internet Age, but certain cyber scams are more prevalent as employees take advantage of the situation.

ONLINE SCAMS AND FRAUD
Economic downturns breed fraud of all kinds, but more cyber criminals are using the bad times to take advantage of unsuspecting consumers through online scams and fraud. According to a report released by the Internet Fraud Complaint Center, run by the FBI and the National White Collar Crime Center, Internet fraud losses reported in the United States reached a record high of $264.6 million in 2008 -- an increase of 33 percent compared to 2007.

The economic downturn plays a key role in this increase because many scamsters have been preying on fear, uncertainty, and doubt that are plaguing workers and consumers. It's a new twist on an old game.