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Encyclopedia

Social engineering fraud

Entersekt | Encyclopedia | Social engineering fraud
What is social engineering fraud?

Social engineering is a tactic attackers use to manipulate individuals into revealing sensitive information or performing actions that compromise their security. These criminals manipulate consumers’ emotions by impersonating a figure of authority, like a banking call center agent or government, and create a sense of urgency or fear that drives the consumer to share personal information with the fraudster.

What are the main types of social engineering scams?

Social engineering attacks can occur over the phone, via a fake link in an email, through an SMS, or in person. Examples of social engineering scams include:

  • Pre-texting: When a criminal pretends to be a trusted official and steals a consumer’s personal information.
  • Spear phishing: A type of phishing attack that is curated for a particular target.
  • Vishing: An example of phishing where the fraudster gathers information about their victim via a phone call.
  • Baiting: A consumer clicks on something that’s irresistible to them, such as a not-to-miss bargain through a fake social media ad.
  • Business email compromise: An employee opens an email that seems to originate from a trusted business source like company supplier but it’s actually fake.

How to prevent social engineering fraud

Financial institutions can protect their customers from social engineering by investing in modern customer authentication tools. Risk-based authentication is a good approach to follow as it assesses the risk of each transaction in real-time and adapts authentication measures based on the risk assessment.

Biometric authentication can also reduce the risk of social engineering scams. Biometrics are unique to each customer, making them a reliable way to verify who is transacting. Using identity verification tools, like a face scan, is another good approach to block unauthorized access.

Authentication tools that leverage artificial intelligence (AI) and machine learning (ML) can also help FIs keep their fraud prevention solution up to date against evolving fraud attacks, where fraudsters use AI to improve and automate their scams.

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Keywords:

Social engineering fraud | Biometric authentication | Risk-based authentication
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