Beware! Identity is the new gold - and criminals know it
25 November 2019 | Web Article Number: ME201917029
STOLEN identity is a highly potent tool for fraudsters, writes Ayanda Kotobe (pictured), Finance Director at RS Components.
As a recent Carte Blanche insert featuring RS Components revealed. A buyer approached us to procure equipment on credit to the tune of R1.5 million. But something didn’t add up - there was a major discrepancy between the names on the supplied ID document and the photo.
One of the fraudsters were eventually caught in a sting operation, the focus of Carte Blanche’s story. In this case, it was the criminal’s own mistake that got them into trouble, offering an ID document that immediately raised suspicions. But not all criminals are so clumsy with identity. They know it’s very valuable in today’s world.
Identity theft is rising sharply. While we spend considerable time worrying about our privacy online, suspicious of ad campaigns that try to guess our preferences, identity thieves operate on a much more dangerous level. They steal our credentials then use these to commit other crimes.
South Africa hasn’t been spared - quite the opposite. Stories warning about identity theft stretch back several years, but the problem is growing more acute. According to the Southern African Fraud Prevention Service, the use of real identities by criminals - identities that were stolen from other people - lept 99% between 2018 and 2019. Criminals are using gaps in the law to get away - despite thousands of identity fraud cases being lodged every year, few are prosecuted because the criminals can’t be easily identified or located.
Fraudsters will use identities from other victims and can forge documents such as proofs of payment. They know identity is the new gold: if you have access to a person’s key credentials, you can do a lot. Con artists and cybercriminals hunt for identities they can steal and then abuse. Instead of stealing your car, they copy your keys and then let themselves into your world.
If we want to create a safer world, we need to start taking identity seriously. We should also be vigilant about those transacting with our companies. Here are a few tips on staying ahead of fraudsters:
- Insist on certified copies of identification.
- Vet the information given: ask for the seller’s company details; check the address and phone number; run the seller’s VAT number through the SARS VAT database (https://secure.sarsefiling.co.za/vatvendorsearch.aspx).
- Verify independently: cold-call the company using its listed number and ask to speak to the person who contacted you. Fraudsters often use legitimate company details, hoping they won’t be checked.
- Do not share bank account details unnecessarily. If you want to ensure maximum safety during a transaction, consider an escrow service that acts as an intermediary between buying and selling parties.
- Use digital statements and accounting platforms to effectively track transactions.
- Maintain reliable records of supply chain agents and companies.
- Establish clear procurement and dispatch frameworks for your employees to operate in with peace of mind.
This last point is very important. Identities are often used to steal from companies, usually by posing as a legitimate buyer or submitting fake invoices. The less control and oversight you have of your procurement and dispatch operations, the more room you create for a con artist to wiggle in. Some may try to steal big, but others could syphon money from your accounts over long periods.
Vigilant staff are the first line of defence against fraudsters. Our intuition as people can serve us very well and be more effective than any type of law or technology. But if we don’t get the right support from our environment, we can’t be as sharp. An accounting system in disarray or a vague pool of suppliers weakens the ability to spot fraudulent activities.
We have that benefit at RS Components, using modern technologies to keep our processes transparent and enabling our staff to check their suspicions with confidence and speed.
Identity is the new gold and the most valuable tool in a modern criminal’s toolset. If we want to fight back, we must make it harder to use stolen identities and easier for your staff to act when something might be wrong.