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Payment fraud attempts on US businesses up 71% – Industry roundup: 24 January

Payment fraud attempts on US businesses spiked 71% in 2023

Almost all (96%) of US companies were targeted with at least one fraud attempt in the past year. Some 90% of those companies were hit with at least one successful attack, according to a research survey of more than 260 senior finance and treasury leaders. The proprietary research, which was conducted and released by Trustpair, uncovered that a rise in cyber fraud, which includes activity such as hacking, deepfakes, voice cloning and highly sophisticated phishing schemes, is driving the increase in attacks.

Over four of every five US companies (83%) saw increased cyber fraud attempts on their organisation in the past year. Fraudsters primarily used text messages (50%), fake websites (48%), social media (37%), hacking (31%), business email compromise (BEC) scams (31%) and deepfakes (11%) to dupe organisations. CEO and CFO impersonations (44%) were the third most common type of fraud.

The research, ‘Fraud in the Cyber Era: 2024 Fraud Trends and Insights’, unveils the most significant fraud risks, challenges and opportunities facing the enterprise. It finds that payment fraud is hitting organisations hard. Over one-third (36%) of companies said the average financial loss of successful fraud attacks they experienced was more than US$1m. A quarter of businesses (25%) said the loss was more than US$5m.

The research also outlined how business relationships are at risk due to fraud. Three-quarters (75%) of C-level finance and treasury leaders say they’d stop doing business with an organisation that fell victim to payment fraud and lost their payment. Finance and treasury leaders lose sleep over the potential of reputational damage with customers (51%), investors (50%) and suppliers and vendors (45%).

Despite these concerns, the research points to companies being trapped in the ‘it won’t happen to me’ mindset. Only 5% of companies say they cannot keep up with the growing sophistication of fraudsters and fraud attacks. Yet 90% of the companies that experienced payment fraud attempts were hit with at least one successful attack.

Looking ahead, 67% of companies expect payment fraud to rise further in 2024 – and most aren’t prepared. Only 16% of companies regularly clean and monitor their vendor database. Just 28% verify information on the companies they work with. These gaps are surprising given scammers posing as trusted sources and the creation of false vendors (47%) and wire transfers (53%) were the two most common types of fraud in 2023.

Automation is vital in fighting fraud, and this is starting to increase. One-third (34%) of companies use automated account validation tools to validate vendors, compared to 17% a year ago. Yet 38% of companies say manual account validations are one of their top three challenges regarding fraud prevention.


EU to bring in maximum cash payment limit

The European Parliament has finalised a deal with the European Council on new measures to beef up an EU toolkit to fight money laundering, terrorist financing and sanctions evasion.

Parliament and Council negotiators reached a provisional agreement on the sixth Anti-Money Laundering (AML) directive and the EU “single rulebook” regulation. The agreed provisions, part of the Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT) package will have to be applied by banks and other obliged entities to protect the EU internal market from money laundering and terrorist financing.

The deal includes a European Union-wide limit on large cash payments of €10,000 and measures to ensure compliance with targeted financial sanctions and avoid sanctions being circumvented.

The new bills provide access to beneficial ownership information and give Financial Intelligence Units (FIUs) more powers to analyse and detect money laundering and terrorist financing cases and suspend suspicious transactions.

During the negotiations, members of the European Parliament secured that, from 2029, professional football clubs will be obliged to verify their customers’ identity, monitor transactions and report any suspicious transactions to FIUs. They also achieved enhanced vigilance regarding ultra-rich individuals.


DigiFT and HashKey Capital to offer regulated access to on-chain treasury management 

DigiFT, a regulated exchange for on-chain real-world assets (RWA) licensed by the Monetary Authority of Singapore (MAS), has announced it will be offering regulated treasury management and diversified investment services for HashKey Capital’s portfolio companies in a strategic partnership with the institutional digital asset manager. 

Recognising the scarcity of compliant and secure financial products in the market, DigiFT is offering a series of RWA investment offerings including its trademark product, DigiFT US Treasury Token (DUST), the first fully regulatory-compliant US Treasury token issued on a public blockchain — backed by a single US Treasury note with a specific maturity date, DUST offers accredited and institutional investors an on-chain channel to invest in US Treasuries, with the physical US Treasuries custodised with a licensed broker-custodian in Singapore, as well as the first regulatory-compliant Ethereum (ETH) staking token.

Under the partnership, DigiFT will customise and tailor asset packages accordingly to the needs of HashKey Capital’s portfolio companies. As the first licensed on-chain RWA exchange in Singapore, DigiFT’s solutions address the gap of secure and reliable treasury management and investment offerings from licensed institutions.

This strategic partnership is addressing a perceived market gap in treasury management as corporate treasurers continue to face challenges in balancing short-term volatility while investing for long-term growth. HashKey Capital’s portfolio companies will stand to benefit from DigiFT’s products as they look to maximise the business runway and reduce cash burn.


Crédit Agricole CIB taps iGTB for cash pooling digital transformation

Intellect Global Transaction Banking (iGTB), the transaction banking arm of Intellect Design Arena, has announced a deal with Crédit Agricole CIB, the corporate and investment banking arm of Credit Agricole Group, which will see the bank use iGTB’s Corporate Treasury Exchange (CTX) solution to support its corporate clients to optimise their money management through a cluster of services enabled by iGTB’s technology framework.

A statement from iGTB says that this strategic partnership will help to transform the bank’s cash management and cash pooling business operations, and power the Bank’s corporate customers to higher returns on their cash capital.

As a result of the cash pooling digital transformation, the bank’s clients can use self-service for automated cash pooling, have global 360-degree forecasts across multiple accounts, currencies, banks, and geographies, and possibly enhance returns on cash.

“iGTB’s CTX will help us deliver real time cash pooling and liquidity management with a high level of automation, enabling us to serve our corporate clients better,” commented Chaker Zammouri, Deputy Head of Cash Management Services, Crédit Agricole CIB.  

This news comes hot on the heels of Crédit Agricole S.A. announcing that it has acquired a 7% minority interest in payments firm Worldline S.A. This investment builds on the strategic partnership between Crédit Agricole Group and Worldline S.A., for which a binding agreement was signed in July 2023. It is intended to strengthen this partnership to create a significant player in the French merchant payment services market.


Mashreq partners with Fils on carbon offsetting services for corporates

Mashreq has signed a memorandum of understanding (MoU) with the UAE-based fintech firm Fils, to develop a corporate carbon footprint mitigation offering that helps corporate and institutional clients to integrate carbon offsetting directly from their Mashreq corporate accounts.

Fils is a digital platform that provides the underlying infrastructure for financial institutions, banks and other organisations across industries to launch standalone, sustainable-focused products such as carbon offsetting. This approach to the future of fintech facilitates the transition to an environmental, social, and corporate governance (ESG) compliant corporate landscape, enabling companies of all sizes to effortlessly embed sustainable and climate action into their business models and customer journeys across industries.

To eliminate the deceptive practice of misrepresenting environmental responsibility through greenwashing, Fils infrastructure uses blockchain technology to track all carbon credits used to avoid double counting and provide transparency.

The agreement represents Mashreq’s first step in developing specialised carbon offsetting financial products, which will launch in collaboration with selected UAE-based Mashreq corporate clients. The initial solution is expected to roll out in the first half of 2024.


Nuvei partners with Adobe to enhance e-commerce payments

Nuvei Corporation, a Canadian fintech company, has announced that they are partnering with Adobe to provide customers access to their payments technology through their existing integration with Adobe Commerce, which is part of Adobe Experience Cloud and enables businesses to create, manage and scale their commerce offerings. The partnership aims to enable B2B and B2C businesses operating on Adobe Commerce to simplify payments relationships and expand into new markets.

B2B and B2C businesses specialising in a broad spectrum of verticals, including retail and consumer products, manufacturing, technology, and healthcare, could benefit from the reduction in complexity of a single integration to Nuvei’s technology. The fintech’s API integration to over 680 regional alternative payment methods (APMs) enables Adobe Commerce merchants to reach their customers, where they are and however they want to pay, through local, tailored payment experiences. Businesses are also able to expand internationally through the same, single integration.

In addition to offering APMs in markets across the globe, Adobe Commerce customers can also enable Automated Clearing House (ACH) account-to-account transactions in the US.


NAB launches small business cyber assessment tool with Microsoft 

NAB has partnered with Microsoft to deliver a free cyber assessment tool to help Australian small businesses prepare for and bounce back from a cyber attack. The free, tailored self-assessment takes under two hours and asks participants questions about their organisation’s security, data and IT environment. The data findings and answers are used to provide participants with tailored, fact-based advice on how to improve cybersecurity for their business.

NAB Chief Security Officer, Sandro Bucchianeri, said the tool can help small businesses determine their cyber maturity today and make better informed decisions to protect their business, employees and customers in the future.

“The number of cyber attacks impacting small businesses continues to grow each year. Last financial year, a cyber crime was reported every six minutes and cost small to medium businesses an average of AU$71,600, according to the latest research by the Australian Signals Directorate, with incidents surging 23%,” Bucchianeri said.

“As we’ve seen over recent weeks, cyber criminals are stepping up their tactics, targeting high profile Australian businesses on a near-daily basis, impacting everyone from our hospital system, legal system and business community. Tools like this will help the small business sector respond if they are caught up in a hack.”

Bucchianeri added that heading into the new year, cybercriminals are looking for new ways to reach new victims. “We’re seeing an increase in phishing scams and ransomware which all continue to be among the top cyber threats that NAB customers report, as well as issues we see across industry.” 

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