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Internet's Web of Scams

The Internet has made it extremely easy to distribute information to millions of people, including fraudulent business deals and email scams. Fraud and scams are lurking all over the Internet, waiting for innocent victims who will pay or give out their personal details for what they think might be a legitimate business deal. Being aware of what's true and what's not plays a large part in being a responsible citizen of the cyber world.

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Bank Fraud- What you need to know

Bank Fraud- What you need to know

Due to rising job losses and economy tumbling, people are looking for easy ways to make money especially illegal ways. What they don't know is the consequences that one will have to face if found guilty.

Bank fraud is defined as the appropriation of money and other assets fraudulently, through intentional deception and misrepresentation from the bank either through direct transfers, withdrawals, ATMs, Money laundering and various other methods that is used by scammers.

Bank frauds are carried out either by an internal sources or an external source in many different ways. Here is a look at some of them, . Fund transfer fraud - Insiders in the bank use this method along with forged documents of a customer who frequently transfers funds to transfer and wire money to their own accounts in foreign countries.

. Forged documents - Documents are manipulated by workers or insides at the bank as the daily accounts have to be balanced. The sum or amount that is forged is deposited or taken by the insider caring it out. Generally there is someone who aids and abets and gets a commission, from the money that is swindled.

. Identity theft - Customers personal information is used to carry out identity theft in banks or in other financial institutions. Since insiders have all the data on the customer they will use it to obtain banking facilities.

. Uninsured deposits fraud - Some banks themselves are frauds and do not have the license to operate at all. Therefore, depositors are at risk of losing their money to these uninsured banks.

. Demand draft fraud - Demand drafts are issued by an employee to foreign banks, of course to their own accounts and usually since demand drafts paid for without any questions being asked, this type of fraud goes unnoticed until at least 7 months, when it is too late to recover the funds.

. Rogue trader - An insider appointed by the bank to make good and clean investments are tempted by 'shady deals' and invest their money on unreliable sources for a higher interest, the higher interest is taken by the insider, he also gets a commission from the person he invested with and the balance goes to the bank. Since these deals are not reliable and investors are not true to their word the insider ends up getting 'played out'.

. Stolen cheques - Fraudsters get access to cheque books use the customer's signature to withdraw money and issue cheques. The customer eventually gets caught, but he is obviously the innocent party.

. Forged and altered cheques - Cheque signatures are forged, the name of the company and the amount of the cheque is also forged. Sometimes fraudsters even print their own cheques, which looks very much like the bank cheques.

. Cheque knitting - Fraudster use this system to issue one cheque before the other cheque is realized, to the customer. Once the cheques get realized however, there are no funds and the customer is left without the goods as well as the money. . Accounting frauds - Companies that run into a financial crisis use manipulated accounting figures to maintain their banking facilities and avoid fore closure.

. Credit card frauds- Fraudsters use credit cards to carry out various crimes, usually they manipulate duplicate or forge the details on the credit card to their benefit. These frauds cannot be traced quickly and takes years and years of investigations.

. False loan application - Loan applications are filed out using false and misleading information, false supporting documents.

. Money laundering - Loans are obtained and then the loans are used to invest in stocks and securities and then the person defaults the loan. The securities are valid for its full amount.

. Forged currency fraud - Forged currency is printed regularly and circulated into the open market. Sometimes even the bank is unable to tell a counterfeit from the original.

Here is a look at some of the security features and other methods used to detect and spot bank frauds:-

. Pantographs on cheques

. Water marks on cheques

. Magnetic strip on credit cards with holograms

. Chemicals

. High resolution micro printing

. Type of Security inks
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