Financial Crime World

Wake-Up Call for Indian Businesses: The Surge of Platform Fraud and How to Combat It

According to PwC’s latest Global Economic Crime and Fraud Survey 2022: India Insights, platform fraud has risen drastically in India in the wake of the pandemic and the shift towards remote work and online transactions. This form of fraud, which includes social media, enterprise, and e-commerce fraud, accounted for 57% of all fraud incidents in India. In this article, we explore the types of platform fraud and ways for organizations to mitigate the threat.

The Rise of Platform Fraud in India

Platform fraud is an emerging threat that businesses need to take seriously. In recent years, social media platforms, e-commerce sites, and enterprise platforms have become prime targets for fraudsters. With an average of five platforms in use by Indian organizations, the shift towards platform-based business models has accelerated, particularly during the pandemic.

Types of Platform Fraud

  1. Synthetic ID Fraud: This involves the use of fake or stolen identities to create accounts, access services, or obtain goods.
  2. Net Fraudulent Transactions: Unauthorized digital transfers to or from a platform can result in financial losses.
  3. Identity Theft/Account Takeover: Fraudsters gain unauthorized access to user accounts, often through phishing or malware.
  4. Ransomware: Cyber attacks can lead to data breaches, resulting in significant financial and reputational damage.

Mitigating the Threat

Combating platform fraud requires a proactive approach. Organizations can take the following steps:

  1. Stay Vigilant: Keep an eye out for red flags and invest in advanced monitoring tools.
  2. Implement Strong Internal Controls: Elevate responsibility for platform risk management to the C-suite level and implement strong internal controls.
  3. Assess Exposure to Platform Risks: Regularly assess your organization’s exposure to platform risks and invest in purpose-built transaction monitoring systems.
  4. Stay Informed: Keep up-to-date with new threats and trends in platform fraud, such as sanctions evasion and ESG-related criminal activities.

PwC’s team of forensic services experts advises Indian businesses to build resilience against platform fraud and be prepared for emerging threats. Don’t wait until it’s too late. By taking proactive measures, organizations can significantly reduce their risk exposure to these insidious threats.

For more information on how PwC can help you protect yourself from platform fraud, please contact their team.