A wolf in sheep’s clothing is an excellent way to describe most scams. Someone pretending to be a good guy when they are nothing but a bad guy.

And there are so many wolves out there! One wolf managed to scam a bank so bad this week that it collapsed the entire bank.

Well, it’s been another very busy week in fraud.

This week we saw

• Scammers are acting more like confident fraud analyst

• A bank in the US collapsed because they got scammed

• FICO says skimming is way up 77% this year

• Data breaches are on track to hit a record too

• Vestoo Fraud trips off a Global Insurance scandal

• A new fake account scandal at Wells Fargo emerged

• A New Fraud Type emerged -Drivers License Appt Fraud

• Yet another Evil AI tool is in the works - DarkBART

• A teen let people get a glimpse into his fraud empire

Let’s dive into some of the top stories of the week.

You’re Going To Get An Alert - Ignore It.

Scammers are always one step ahead of banks in their impersonation scheme.

In the latest scam variant, fraudsters are proactively telling their victims, “You’re going to get an alert from us, just ignore it”.

Rachael Adler, a victim of a cunning Zelle scam provides her account of what it appears to be one of the most flawless orchestrated fraud analyst impersonations I have seen.

Click in this link or the image below to read the article

Heartland Tri-State Bank Was Scammed And Then Collapsed

That escalated quickly. Heartland Tri-State Bank collapsed last week after losing over $262 Billion in assets.

And no, this wasn’t a Silicon Valley Bank situation, rather they fell victim to a major scam which hastened their collapse.

While many had speculated that this was another bank run, regulators were relieved to report that it was “only a scam” and an isolated incident.

Gavin Magor did some digging on the scam and found out it was a multimillion dollar scam- somewhere between $8 million to $12 million which was all of their capital. He called the FBI and many others but they would not comment on exactly what hapened.

While this may be considered an “isolated incident”, it may not be just that simple. Fraudsters and scammers regularly target smaller community banks and credit unions because they can often be ripe targets.

CyptoRom Scams Are Using ChatGPT To Fleece Victims, Download Fake Apps

Are you familiar with CryptoRom Scams? A new research report published by Sophos News details exactly what they are, and how scammers are now resorting to ChatGPT to build better more convincing text messages to their victims.

CryptoRom scams combine romance scams with crypto investing scams and it’s a deadly mix that requires a lot of finesse and social engineering by the scammer.

That’s why they are turning to ChatGPT to assist.

A screen shot from one of the scammers shows how they forgot to remove the standard “As an AI model” from the text they sent.

The scammers are also convincing victims to download fraudulent crypto trading apps from the Android and Iphone App stores which are designed to steal the victims money!

Click on this link or the image below to read the article

“Synthetic Identity” Fraud Scandal Emerges At Wells Fargo. But Is It Really?

Regulators like to take out the boxing gloves and beat up on Wells Fargo and last week another “fake account” scandal seemed to emerge.

But unlike the fake account scandal of 2016 which involved 1.5 million accounts, this scandal only involves about 40 consumer complaints to the CFPB.

Media outlets attributed it to Synthetic Identities at the bank because the accounts were opened with incorrect dates of birth and in some cases emails that didn’t match to the victim.

But this doesn’t seem “scandal worthy”, rather this is an industry trend that impacts all banks. The bank has over 70 million consumer accounts and the accounts appear to be more linked to pure identity theft where victims data was stolen and used to open accounts.

Now do I think the impact of synthetic identity is large in banking? Absolutely, but I don’t think that we are dealing with another large fake account scandal at Wells Fargo alone.

Click here or the image below to read the article

Drivers License Appointment Fraud. Yeah This Is A Real Thing Apparently

Florida is battling a new type of fraud and it’s a doozy - appointment fraud.

According to officials in the state, third parties are monitoring available appointments for Drivers Licenses possibly through the use of artificial intelligence and bots, and snatching up all the appointments.

Then they sit in the parking lots and wait for people heading into the building and sell the appointments for $40 to go to the front of the line.

hmmm having sat in DMV lines for hours at a time you can see why many might just make that purchase!

With This Little Known Protocol - Bank Staff Deny Customers And Save Millions A Year

It’s called Banking Protocol and it allows bank staff to deny a customer request to send a payment if they suspect a scam or fraud.

In the UK, the emergency procedure was used 11,643 times in 2022.

Of those, transactions worth £55m were deemed to be fraudulent by police and staff according to UK Finance.

Since it was launched in 2017 it has been successful in allowing banking staff to stop over 50,000 fraudulent transactions.

As we are seeing time and time again, the UK’s progressive stance on protecting consumers is a model for the rest of the world

FICO Alert - Skimming Is Up A Whopping 77% This Year

Holy Heck, I thought Chip Cards were supposed to get rid of skimming here in the US?! What gives?

Apparently fraudsters still want those cards to clone them. In fact Debbie Cobb, the Senior Director at FICO calls the increasing trend “disturbing” and one of the most “pernicious” frauds out there.

The biggest increase in skimming took place at ATM Machines where the number of skimmed frauds actually doubled (109% increase over last year). FICO says about 33% of all skimming devices are placed on ATM machines.

That means they could be getting your PIN and extracting all the cash out of your accounts!

Vestoo Document Fraud Trips Off A Global Insurance Scandal

Several weeks ago, I reported on an interesting and developing story about Vestoo - the hot Israeli startup promised to use artificial intelligence to spread the risk of insurance policies.

There were rumors of a massive collateral fraud that threatened the company. Apparently, fake letters of credit were used by China Construction Bank and when an attorney went to investigate the fake collateral he was thrown out of the bank by security guards.

Well the contagion has spread and The Wall Street Journal is reporting that the founders may now be ousted!

Click On This Link Or Image Below To Read The Report

The Maker of FraudGPT is Cooking Up His Next Evil AI Tool - DarkBART

The inventor of FraudGPT, CanadianKingpin12, is reportedly creating another adversarial AI tool called “DarkBart”.

In less than a single month, 3 malicious variants of AI have emerged; WormGPT, FraudGPT and now DarkBART.

Just as ChatGPT was built on the open internet, DarkBart is being built on the entirety of the dark web - trained to be used as a malicious tool and lower the barriers to entry for anyone to commit scams and sophisticated frauds.

Apparently the threat actor claims to have gained access to “DarkBERT” a tool created by South Koreans to fight cybercrime and is leveraging it for evil purposes.

Click on this link or the image below to read the article

Go Inside This Teens Fraud Empire

Young fraudsters are pretty proud of their craft, and more and more of them are taking to Youtube to show their fraud chops.

Financial Wolf, goes inside this teens fraud empire and watches how he commits fraud. The guy has zero remorse.

Thanks for catching up on the latest fraud trends and stories of the week.

I hope you have a great week fighting fraud!

FrankonFraud