A new type of mafia is targeting your bank account in South Africa

A new wave of sophisticated fraud, orchestrated by international criminal syndicates, is targeting South African bank accounts, leaving victims and businesses vulnerable.

In 2024, bank fraud in South Africa has surged, with scammers employing increasingly sophisticated tactics to exploit individuals and businesses.

Major banks, including Absa, FNB, Capitec, Nedbank, Standard Bank, and Discovery Bank, have all warned customers of emerging fraud methods targeting South Africans in 2024, emphasising the need for vigilance.

The most recent scam involves syndicates exploiting stolen credit card details to fund deceptive Facebook advertisements, which are then used to lure unsuspecting consumers to fraudulent websites.

The situation highlights vulnerabilities in digital payment systems and exposes the broader implications for the e-commerce industry.

Maya Fisher-French, a journalist and recent victim, recounted how her joint household account was drained of R20,000 in unauthorised transactions labelled as “Facebk.”

This was not due to negligence or falling prey to phishing scams but rather the result of criminals exploiting stolen credit card information.

The stolen funds were used to pay for Facebook ads promoting fake online stores.

Victims, enticed by promises of deep discounts, provide their card details, unwittingly granting criminals access to their funds.

The goods never materialise, and the consumers are left with financial losses and compromised credit card data.

The fraudulent activity appears to be part of a larger strategy tied to global trends in cybercrime.

Thabani Ndwandwe, Chief Risk Officer at Standard Bank, noted that syndicates take advantage of peak shopping periods like Black Friday to blend fraudulent transactions with legitimate spending.

The increased volume of transactions during such periods lowers the likelihood of detection.

Simultaneously, banks adjust fraud detection thresholds to accommodate higher transaction activity, creating an ideal environment for criminals.

Card details used in these schemes are often sourced from data breaches or purchased on the dark web.

Data from e-commerce platforms, subscription services, and phishing scams frequently end up in the hands of criminals.

In Fisher-French’s case, the data breach potentially linked to Disney Plus might have played a role, underscoring the risks of using physical credit cards instead of virtual ones with dynamic security features.

The impact of this fraud extends beyond individual victims.

Businesses that rely on platforms like Facebook for advertising face disruptions as banks tighten fraud prevention measures.

Facebook, in particular, has become a target due to its policy of not requiring 3D Secure Authentication for payments.

While this makes transactions seamless, it also makes the platform attractive to fraudsters.

Banks are now forced to balance customer safety with the operational needs of businesses reliant on online advertising.

South African banks, including FNB, Absa, Capitec, and Standard Bank, have reported cases linked to these schemes.

Chris Boxall of FNB confirmed that fraudulent attempts related to false Facebook merchants have affected multiple banks locally and internationally.

Banks have introduced measures such as temporary card locks, e-commerce transaction deactivation, and encouraging the use of virtual cards to mitigate risks. These cards offer enhanced security through dynamic CVV codes and limited usability.

However, these measures are not foolproof. Customers often endure significant inconvenience during investigations and card replacement processes.

As the festive season approaches, banks are warning customers to remain vigilant.

The combination of increased consumer spending and sophisticated fraud techniques suggests a higher risk of financial losses.

Regular account monitoring, cautious online shopping practices, and the use of secure payment methods are essential defences against these schemes.

Despite the relatively small number of cases reported, the repercussions for those affected are severe. Banks and consumers must adapt to the evolving tactics of cybercriminals to safeguard financial assets and trust in digital platforms.

As e-commerce continues to grow, so too does the urgency of addressing these vulnerabilities in the digital payment ecosystem.

Read: 6 major scams targeting South Africans and their money in 2024