nsKnox: 2021 Was the Year of WFH and Increased Fraud

Working from home gave fraudsters new vulnerabilities to exploit as companies were forced to reinvent business processes using distributed teams. Nithai Barzam, chief operating officer of nsKnox, urges payments leaders to work with IT and information security leaders to educate workers and shore up their defenses. Read his thoughts in the PYMNTS eBook, “In a Word: 50 Thought Leaders Sum Up 2021.”

If we had any doubts, in 2021 it was established that work-from-home and hybrid work models are here to stay. What started as a necessity forced by the pandemic has now turned into something employees demand and many organizations appreciate. 

While the pandemic and WFH present organizations with many challenges, let’s focus on the impact this has made on organizations in their attempt to protect payments against cyberfraud.

Increased Fraudster Activity

According to a survey by the Treasury Coalition, fraud attempts have increased 36% since the outbreak of the pandemic. And with so many people working from home, it’s become harder than ever for finance professionals to protect the company’s payments while ensuring finance-related business continuity.

Harder-to-Maintain Processes

There are so many new vulnerabilities that have been exposed. An attack can happen during a payee onboarding process, when banking details change requests come in, when banking data is “at rest” stored in an ERP system and during the payment process.

With people working from home, each of these processes introduces a new set of challenges. For example, when trying to call a supplier in their office, as part of the best-practice process of verifying banking details, people are just not in the office and are not answering the phone. It has become too difficult to find the right person to speak with, and the required procedures are not being followed.

Advanced Technology as a Weapon

To make things even more complicated, now that we’re communicating using cell phones more and more, fraudsters are using advanced technologies such as artificial intelligence (AI)-based voice cloning to dupe unsuspecting employees into authorizing payments to fraudulent accounts.

Vulnerabilities With WFH Technology and Communications 

When working from home, employees use their home Wi-Fi to connect to work-related systems. Home networks are not secure as those in the office. Moreover, personal devices are used to perform work-related tasks more often these days, further deepening the vulnerabilities. 

The Bad Insiders Challenge

Outsiders are not the only threat. Insider fraud is also growing. The Global Economic Crime and Fraud Survey published by PwC indicates that 50% of economic crimes are committed by insiders. And with increased pressure felt by employees, and less control by their managers, more and more employees are rationalizing stealing money from their company. 

Making Things Better

So, the pandemic and WFH have resulted in increased fraudster activity, difficulty to maintain processes and new vulnerabilities. Protecting payments is harder than ever.

But there are still things to do. 

First, collaborate with your IT and information security teams to ensure infrastructure security, considering that working from home is part of the new working model.

Second, implement updated best practice processes. Adjust key processes and publish a new baseline. 

And third, introduce technology and automation to payment-related processes. We at nsKnox would love to help reduce reliance on manual, error-prone controls for payee onboarding and account validation, as well as payment validation processes.