What Is Cyber Financial Crime And How It Can Affect You?
The world has changed dramatically over the past two decades, with much of our socialization, banking, and commerce taking place in the online environment. While the benefits of this shift have been immeasurable for both consumers and businesses, it’s also created new opportunities for criminals.
Cyber financial crime has been an overarching issue in recent years, with big companies like Facebook experiencing data breaches. What does cyber financial crime mean, and how are you affected? Read on to find out.
What is Cyber Financial Crime?
Cyber financial crime pertains to any online criminal activity that’s conducted with direct financial gain in mind. In other words, when a criminal is capturing finance-related data, such as credit card numbers and information, identity information, etc.
Many cybercriminals target the individual directly. Every time you receive a fraudulent email from a fake Apple address or the IRS with a link, you’re being targeted in an attempted cybercrime. Yet, many cybercriminals target organizations to try and collect as much personal data as possible in one shot.
In many ways, the evolution of the internet is outpacing cybersecurity. This gap leaves an opening for cybercriminals to get in and cause damage.
How Cyber Financial Crime Affects You
The direct impact of cybercrime is apparent: you could have your money or identity stolen. However, there’s also overarching business impacts to consider. It’s a common misconception that cybercriminals only attack the Facebooks of the world, but that’s a myth.
Small businesses are at the greatest risk of data breaches and catastrophic data losses. 43% of cyber attacks are aimed at small businesses, as they have fewer resources and are less likely to invest in cyber security. Here are some of the negative impacts of cyber financial crimes:
Causes Business Disruption
When a business experiences a cyber attack or data breach, dealing with the issue becomes priority number one. This means the majority of resources are redirected to finding and correcting the issue. As such, a cyber attack causes significant business disruption.
Opens Potential Lawsuits
When businesses capture and store customer data, they’re agreeing to protect it. Failure to do so could put the business at risk of a significant lawsuit from customers. Facebook had to pay $90 million in damages after its data breach in 2019.
Increases Costs
The issues caused by a data breach increase business costs, as more resources are needed to deal with the issue. Depending on the business structure, there’s also a potential for personal lawsuits against the owner or leadership.
Increases Shutdown Risk
All of these issues culminate in an increased shutdown risk. The costs, loss of reputation, and damaged infrastructure force many small businesses to close for good. It’s estimated that at least 60% of small businesses that experience a successful cyber attack go out of business within six months.
How to Prevent Cyber Financial Crime
Prevention is paramount when facing potential cyber financial crimes. The two focal points for prevention are tools and education. Implementing risk management software with X-Sight AI can proactively detect risks and offer solutions. Simple security measures like a locked WiFi network, firewall, and malware detection programs also make a difference.
Employee error or complacency is the top cause of data breaches. They often occur when an employee clicks an email phishing link or downloads a virus on the company network. Don’t assume your employees know what to look for; dedicate time to training and education, hosting refresher courses regularly. It’s also important to communicate the stakes of a data breach to employees— i.e., a lack of job security.
By investing in knowledge, awareness, and protective software, you can protect your business and personal information from cyber financial criminals.
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What Is Cyber Financial Crime And How It Can Affect You?
