Orals East Africa>Kamiti calls bypass multibillion banking firewalls At the hut of the story

Written by Oral East Africa

Fraudsters are bypassing expensive firewalls set up by bankers, using inside men and social engineering where they simply talk customers into surrendering their details to breach security features.

Since 2014, the banking sector has invested in top notch security features like the Chip and PIN technology to deal with automated card skimming and additional security layers in cards and online transactions.

Banks are splurging billions of shillings on updating and acquiring new software, retraining staff, and hiring new talent, highlighting the increased anti-fraud war amid rising threats on the sector that holds nearly Sh6 trillion in customer deposits.

Even as Kenyan banks build strong IT systems to prevent digital fraud, criminals are still getting access from inside men and customers who hand over passwords to a stranger over the telephone, forget to report a stolen ID or transact in public wifi.

Inside men

Kenya’s economic challenges, rising cost of living and job uncertainty are driving up fraud cases involving internal players and posing a huge headache for lenders.

A Co-operative Bank of Kenya IT expert was charged with disclosing to a third-party account details of a customer from whom Kes2.2 million was stolen.

Mr Simon Sirere Seno, a Digital Data and E-Channels Support Officer, was accused of accessing data held at the bank's Finacle Computer System (FCS) for a customer, Nancy Nyambura Kihanga.

At least nineteen suspects were arrested over a massive debit card fraud that saw Equity Bank lose over Kes290 million. The bank’s risk department discovered an upsurge of transactions emanating from the banks Incoming MasterCard GL.

Customer awareness

Digital fraud schemes are on the rise in the country with 80 per cent of Kenyan having been targeted in the first three months of this year, according to new Trans Union's Consumer Pulse Survey.

Banks have stepped up awareness campaigns to warn their customers since 2019 when the Kenya Bankers Association (KBA) VISA, Mastercard, AirtelKenya, PesaLink, the Retail Trade Association of Kenya, and the Consumer Grassroots Association came up with Kaa radar fraud warning to educate customers of these risks.

Trans Union's Consumer Pulse Survey has shown 80per cent of consumers reported being aware of any fraud schemes targeted at them as banks step up campaigns to deal with digital fraud amidst heightened use of mobile and internet transactions in Kenya.

From the findings a notable 72 per cent of respondents who reported being targeted by digital fraud schemes successfully avoided falling victim.

Vulnerable handsets

Cyber-attacks are on the rise as fraud scheme become more high tech and target vulnerable points especially mobile.

A new report by the Communications Authority of Kenya (CA) shows that cyber threats detected by the Kenya Computer Incident Response Team Coordination Centre (Ke-CIRT/CC) increased by 943 percent.

Over the quarter, there was a 94 per cent increase in the number of attacks targeted at mobile applications, which targeted mobile de-vices such as phones and smart (android) TVs.

Travellers soft target

Most of the attacks are targeting travelers who are away and out of reach and turn to digital channels without talking to their resident banks

According to the TransUnion 2024 State of Omnichannel Fraud Report indicating that the most rapid growth in digital fraud attempts during the year was recorded within the travel and leisure sector.

Industries that saw the highest percentage of digital account creation transactions suspected to be digital fraud were retail (44.7 per-cent), travel and leisure (36 per-cent) and video gaming (31.5 per-cent).

Examples of the types of transactions that take place during the account creation process, the, report says, include account sign-up, registration and loan origination.