ATTRIBUTED TO FRIDAY CHUA, FOUNDER AND CEO OF CIMS TECH
In early 2023, Malaysia had a total of 44.05 million active cellular mobile connections and counting. Clearly, digital communication has become an integral part of everyday life, which includes day-to-day operations for local businesses. However, there’s a darker side to the surge in online communications — the growing epidemic of mobile scams.
As a significant portion of these fraudulent activities are happening on platforms like WhatsApp, we will specifically explore the role that WhatsApp plays in this scam epidemic, and how the safety of online communication can be bolstered.
Malaysia’s Rising Online Scam Epidemic
According to PwC’s Global Economic Crime and Fraud Survey 2022, a staggering 51% of organizations experienced fraud over the course of two years, with a whopping 40% of these cases related to platform fraud. The most common form of platform fraud involves fraudulent transfers, which include cases like identity theft, device cloning, and synthetic IDs.
In fact, online fraud accounts for a majority of commercial crime in Malaysia. From 2020 to 2023, a total of almost 72,000 commercial crime cases were reported, resulting in RM5.2 billion in losses — and 68% of these were online fraud cases.
Scams, of course, affect individuals and businesses of all sizes, but MSMEs and SMEs often are too busy focusing on revenue generation and other business-related priorities to dedicate attention and resources to fraud prevention and securities. In addition, they may not have the tools or knowledge at hand to keep scammers at bay in the first place.
WhatsApp’s Role & Vulnerabilities
With up to 13.8 million Malaysians in the country using WhatsApp, the platform has become a focal point for scammers. These bad actors commonly use the platform to carry out various scams, from phishing to deceptive charitable donations, and even verification code scams. There are even cases where scammers pose as HR recruiters, targeting Malaysians seeking part-time work to cope with rising costs of living.
Naturally, the convenience and widespread use of WhatsApp makes it an ideal hunting ground for these fraudsters. Recent advances in artificial intelligence technology contribute to the seeming credibility of scams as well. Scarily, researchers at McAfee discovered that cybercriminals now need as little as three seconds of someone’s voice to successfully clone it and make it usable in a scam call thanks to generative AI tools. This only makes it that much harder for the average person to determine a scam from a genuine message.
In addition, even the app’s end-to-end encryption can give users a false sense of security, as messages backed up in the cloud are still fairly unsecured. Granted, WhatsApp is working on an upgrade to address this problem by introducing password protection for cloud backups. Despite this, it’s clear that there needs to be another level of security, especially for those who rely heavily on the platform for conducting business.
WhatsApp Business Verification: Building Trust
Knowing all this, a crucial step in addressing the scam epidemic on WhatsApp is the implementation of WhatsApp Business Verification. A verified Whatsapp Business account creates a stronger first impression by displaying your business name and badge, which also helps to increase visibility. Most importantly, this verification badge helps users distinguish between legitimate businesses and potential scams, fostering a safer environment for online transactions and communication.
The escalating scam epidemic in Malaysia is undoubtedly a pressing concern that demands immediate attention. As we have seen, scams have evolved to exploit the vulnerabilities of online platforms like WhatsApp, putting millions of users at risk. To combat this issue effectively, awareness, education, and measures such as WhatsApp Business Verification are essential. CiMS Tech aims to continue encouraging Malaysian businesses to stay vigilant and adopt a proactive stance in online security.