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South Africa facing financial crime scourge
A new report has revealed that South Africa is grappling with a formidable array of financial and banking crimes, spanning contact crimes, digital offences, application fraud, and card fraud.
The SABRIC annual crime statistics report for 2022 sheds light on the multifaceted landscape of financial fraud and security challenges in South Africa’s banking industry.
SABRIC CEO Nischal Mewalall said, “Collaboration among government entities, the private sector, and civil society is paramount to effectively combating financial crime.”
“The commitment of organisations like SABRIC to bolster law enforcement capabilities, fortify regulatory frameworks, and promote transparency and accountability is unwavering.”
SABRIC’s report made several findings that revealed concerning financial crime trends in the country.
One finding was a surge in ATM attacks. The report found that ATM explosive attacks surged by 23% despite the deployment of dye-stain technology.
Overall, there was a 13% increase in ATM attacks during 2022, resulting in a 59% increase in losses.
74% of the reported incidents can be attributed to SABRIC member banks, while non-SABRIC member institutions reported the remaining 26%.
There was also an alarming surge in digital banking fraud in 2022. South Africa saw a 36% increase in reported incidents of online banking fraud in 2022.
Financial losses per incident in online banking fraud also soared in 2022, reflecting a 9% increase from the previous year.
Phishing and vishing continued to be the preferred methods for illicitly gaining access to confidential banking data.
In particular, reported incidents of fraud on banking applications saw a major rise of 36%, with the number of cases increasing from 12,254 in 2021 to 16,638.
Associated gross losses increased by 68% from R219.25 million to R363.32 million. This segment accounted for 46% of digital banking crimes, making it the most targeted area. Consequently, it also experienced the highest proportion of financial losses at 49%.
However, the report identified a 39% decrease in branch-before-deposit robberies. The drop can be attributed to the successful arrest of main suspects in specific regions.
There was also a 17.6% decline in fraudulent vehicle asset finance applications. The report said this was driven by the effectiveness of robust fraud detection systems implemented by banks.
Card fraud, encompassing debit and credit cards, also saw an 18.4% decrease overall.
source:South Africa facing financial crime scourge – Daily Investor
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