Common Types of Online Transaction Frauds

30 August, 2024

Synopsis

• The increase in online transactions has led to an increase in online fraud.

• Some of the frauds are Phishing, Vishing, MitM and Ransom Attacks and UPI Fraud.

• Alert the bank and police and block your cards immediately if you’ve been a victim.
  
  

With the exponential growth of internet usage and digital payments in India, online transactions have become a routine part of daily life. This digital revolution has also opened the door to various types of online transaction fraud. This article explains the most common types of fraud in online transactions, how they occur and measures to protect oneself.

Types of Online Banking Frauds and How to Prevent Them

• Phishing
  Phishing is a scam where fraudsters pose as legitimate entities via emails, messages or fake websites to steal sensitive information. To prevent phishing, verify email addresses, avoid suspicious links and use anti-phishing tools like browser extensions and detection software to block such attempts.
  
  

• Online Shopping Fraud
  Online shopping fraud occurs when fake websites or fraudulent sellers trick buyers into paying for non-existent products. Fraudsters create convincing sites or fake listings, then disappear after payment. To avoid such online Debit Card fraud, verify website authenticity (check HTTPS, read reviews), use secure payment methods with buyer protection and be wary of unrealistically good offers.
  
  

• Vishing (Voice Phishing) 
  Vishing involves fraudsters posing as bank reps, officials or tech support via phone to extract personal info, often creating urgency or threats. To prevent online transaction fraud through vishing, verify caller identity, hang up and call the organisation directly, and use call-blocking apps to detect and block spam or phishing calls.
  
  

• Man-in-the-Middle (MitM) Attacks 
  Man-in-the-Middle (MitM) attacks intercept communication between two parties to steal information, often via unsecured Wi-Fi or malware. To prevent MitM attacks, avoid public Wi-Fi for sensitive transactions, use a VPN to encrypt your connection, and keep your device's software updated to protect against vulnerabilities.
  
  

• Ransomware Attacks 
  Ransomware encrypts data, demanding a ransom for access, disrupting operations. It spreads via phishing emails or exploiting software vulnerabilities. You can prevent ransomware by regularly backing up data, using and updating anti-malware software and being cautious with email attachments by verifying the sender before opening them.
  
  

• UPI Fraud 
  UPI fraud involves fraudulent online transactions or phishing scams. Fraudsters trick users into sharing UPI PINs or OTPs via fake apps or messages. Prevent UPI fraud by never sharing your PIN or OTP, using official apps, enabling two-factor authentication, monitoring your account and being wary of unsolicited messages or calls.
  
  

Types of Frauds in Online Shopping

Online shopping frauds involve fake websites or deceptive sellers tricking buyers into paying for non-existent products or services. This results in financial loss and the theft of personal information, which can lead to further identity theft or fraud.

What to do After Online Banking Fraud and How Can the Money be Recovered?

After an online fraud transaction, immediately contact your bank to report the fraud and freeze your account. Change all relevant passwords and enable two-factor authentication. File a complaint with your local cybercrime department. To recover the money, cooperate fully with your bank and law enforcement. Provide all necessary documentation and evidence to facilitate the investigation. Prompt action increases the chances of recovering the stolen funds.

Being Aware of The Types of Frauds Helps Keep You Safe

As digital transactions grow in India, so does fraud risk. Understanding fraud types and adopting preventative measures, staying vigilant and verifying sources can help minimise risks while enjoying digital benefits.

Join Vigil Army, where Vigil Aunty will decode various frauds and give people a heads-up on the dos and don’ts of combating frauds online. To join the Vigil Army, send ‘Hi’ to her via WhatsApp number: 7290030000. 

*Disclaimer: Terms and conditions apply. The information provided in this article is generic in nature and for informational purposes only. It is not a substitute for specific advice in your own circumstances.