South-East Asian ‘scam industry’ rakes in billions

PETALING JAYA: The “scam industry” in South-East Asia is generating revenue amounting to billions of US dollars, and authorities in the region have been stepping up their efforts to curb scams.

According to the United Nations’ most recent report on Online Scam Operations and Trafficking, global scamming generated US$7.8bil (RM36.8bil) in stolen cryptocurrency in 2021, with South-East Asia accounting for a sizable portion.

In Singapore, the authorities have taken steps to manage this worsening crime, which has cost its citizens losses of at least S$633.3mil (RM2.2bil) in 2021.

In 2020, the National Crime Prevention Council introduced a mobile app to filter scam calls and messages to prevent them from reaching mobile phone users.

According to The Straits Times, the app known as ScamShield checks incoming SMS messages and calls against a list of known scam numbers and filters them if there is a match.

Scam SMS messages identified by the app are sent to the phone’s junk folder, while scam calls are automatically blocked without notifying the user.

The republic’s Infocomm Media Development Authority had also imposed a requirement for all organisations to register with the Singapore SMS Sender ID Registry (SSIR).

“This registration is to better protect consumers against non-registered SMS that may be online scams,” the authority said on its website.

Non-registered SMS will be labelled as “Likely-SCAM” which acts similarly to a “spam filter and spam bin”, it explained.

In the Philippines, the country suffered a loss of 155mil pesos (RM12.8mil) in the first eight months of 2023 alone, according to news portal Rappler.

The news report said that the most common modus operandi was online selling scams targeting self-employed individuals aged 21 to 40 using social media messenger apps.

The Philippines State News Agency reported that in 2022, to address the growing incidents of cyber fraud, the state’s central bank required all financial institutions to have an automated and real-time fraud monitoring and detection system.

The country is also looking into passing a new law that will criminalise attacks on financial accounts using phishing, vishing (voice phishing), smishing (SMS scams), and the like.

It was also reported that minimum standards for financial service providers will be imposed, and if they fail to meet them, the providers will be liable for the loss and they will be required to return the defrauded amounts.

Locally, Communications and Digital minister Fahmi Fadzil said that his ministry is in talks with the Prime Minister’s Department to bring a Cabinet Memorandum on the setting up of a National Anti-Scam Task Force in Bank Negara Malaysia (BNM) to curb online scams.

Yesterday, Bank Negara governor Datuk Abdul Rasheed Ghaffour announced that all major banks in the country have implemented the restriction of authentication apps to a single device and introduced a “kill switch” for customers.

“These efforts have borne fruit as we observe a 58% reduction in unauthorised online banking transactions reported to the National Scam Response Centre (NSRC) in the last five months,” he said at the International Conference on Financial Crime and Terrorism Financing held at the Kuala Lumpur Convention Centre yesterday.

“Kill switch” is a feature that allows customers to deactivate their bank accounts and application access should they notice something peculiar or believe that they have been scammed.

Malaysia has also established the National Scam Response Centre hotline at 997 for the public to promptly report any scam cases or attempts.

According to the Royal Malaysia Police, Malaysia saw a drastic increase in online scams over the last two years during the Covid-19 pandemic, with a total of 71,833 scams, amounting to more than RM5.2bil losses, which was reported from 2020 until May 2022.