Cybercrime cost the world $8 Trillion in 2023 alone, and experts anticipate annual financial losses growing at a rate of 15% year over year. Each year, we hear about large corporations navigating cybersecurity breaches, and the risk it presents to the general public. The stories we don’t hear, however, are those of everyday people who are being targeted by cybercriminals around the world.
Cybercrimes both big and small happen every day, and it’s important to stay in the know about what scams are relevant in today’s landscape – especially with the new prevalence of AI. Being informed helps you stay protected and to use technology in a safe way that enhances your life.
All of that being said, let’s go over a few common scams to keep an eye out for, and best practices to protect yourself and your loved ones.
Common Cybercrimes That Target Everyday Investors
Investors can fall prey to various types of cybercrimes, and it’s essential to stay vigilant. Here are a few common ones:
- Phishing Attacks: Cybercriminals may use fake emails, messages, or websites to trick investors into revealing sensitive information such as login credentials or financial details.
- Pump and Dump Schemes: Fraudsters may artificially inflate the price of a stock by spreading false or misleading information (think Wolf of Wall Street – this is the tactic they used in the movie). Once the price has risen, they sell off their shares, causing the stock to plummet and leaving other investors with losses.
- Ransomware Attacks: Companies that investors have invested in may be targeted by ransomware attacks. If these attacks are successful, they can disrupt business operations and impact the stock price.
- Cryptocurrency Scams: Investors in the cryptocurrency market can be targeted by fraudulent Initial Coin Offerings (ICOs) or fake investment schemes, resulting in the loss of funds.
- Identity Theft: Cybercriminals may steal personal information to impersonate investors and make unauthorized transactions on their behalf.
To avoid falling victim to these cybercrimes, investors should stay informed, use secure online practices, and be cautious about sharing personal and financial information online.
Strategies for Financial Cybersecurity
It may feel like cybersecurity scams would be obvious. If you feel confident navigating technology, it’s easy to have an overinflated sense of confidence when dealing with potential scam artists online – and that’s what they’re counting on. The truth is that, as AI and technology continues to advance, the tools at the disposal of cybercriminals are advancing, as well. They’re getting harder to recognize, and even people who consider themselves well educated in the world of cybersecurity get caught in scams every day.
This is why it’s so important to have strategies in place for you and your family to stay cybersecure, even with the evolving technology landscape we’re seeing right now. Here are a few ideas to get you started:
- Implement secure password best practices. Using a secure online password manager, creating secure passwords, maintaining different passwords across all of your online logins, and updating or changing them regularly are all helpful steps in creating a secure password plan.
- Two-factor authentication. When possible, implement two-factor authentication on your key accounts. This might look like connecting your email or phone number to get a secondary login passcode when trying to access your account, or using your thumbprint and/or FaceID to log in when possible. Those items are harder to replicate, and can be the added layer of security you may need.
- Encrypting financial data. Many systems offer some form of encryption to keep your data safe, including secure messaging platforms, HTTPS protection on websites where you’re sharing personal information, etc. If you want to take this a step further, you can always encrypt your own data when it’s stored. Systems like FileVault (macOS), or BitLocker (Windows) allow you to encrypt personal data on your computer or laptop.
- Keep your software updated. Outdated software often presents loopholes where cybercriminals can access personal information. Set your phone, laptop, computer, and/or tablet up to regularly update the apps you use as well as the core software on your device. Often, these updates are done overnight or when you power down your device, so you won’t miss anything!
Financial Institutions and Cybersecurity
Financial institutions like banks and online brokers and trading suites, like Orion, are subject to government regulations that ensure they’re following cybersecurity best practices. Institutions like these have a key role in protecting customer data, and take extensive cybersecurity measures to keep information safe.
For example, they may encrypt data, offer secure access controls, leverage firewalls and/or intrusion detection systems, and more. Their teams are often trained on cybersecurity, and they offer clients several different ways to ensure their information is protected.
Future Trends & Staying In The Know
At Paradigm, we take cybersecurity seriously – especially when it comes to your finances. As October is National Cybersecurity month, we wanted to take time to ensure all of our clients and colleagues feel confident in their own cybersecurity skills. If you’d like to continue your education, and stay up to date on future trends to watch out for, we recommend checking out the following resources:
- Federal resource: The Cybersecurity & Infrastructure Security Agency (CISA)
- Podcast: Security Now
- News: Krebs On Security or CyberScoop
If you ever want more information about how we approach cybersecurity as a firm, don’t hesitate to reach out. We are happy to talk through our best practices with you.