South Africa is grappling with serious financial and banking crimes that are casting a long shadow over local businesses and the economy.
This is according to the South African Banking Risk Information Centre’s (Sabric) annual crime statistics report for 2022 released on Wednesday, which sheds light on the landscape of financial fraud and security challenges facing the banking industry.
Sabric’s latest data released in the report includes a surge in ATM attacks and bombings despite the deployment of dye-stain technology.
“ATM explosive attacks surged by 23% in 2022, posing persistent challenges in the prevention of these high-risk criminal acts,” Sabric said.
South Africa witnessed an alarming 36% surge in reported incidents of online banking fraud in 2022.
Financial losses per incident of online banking fraud soared in 2022, reflecting a 9% increase from the previous year. Phishing and vishing continued to be the preferred methods for illicitly gaining access to confidential banking data.
“Fraudsters deployed a range of tactics, including social engineering and ‘vishing’ scams to deceive victims into divulging sensitive information,” Sabric said.
However, on a positive note, there was a 39% decrease in robbery incidents of customers before they deposit cash at the bank, which the association said could be attributed to the arrest of leading suspects.
“Encouragingly, the number of reported mobile banking fraud incidents saw a 9% reduction in 2022. Additionally, incidents involving SIM swaps declined from 87% in 2021 to 76% in 2022, indicating a waning efficacy of this fraudulent tactic,” Sabric said.
There was also a 17.6% reduction in fraudulent applications for vehicle asset finance (VAF), driven by “the effectiveness of robust fraud detection systems implemented by banks”.
Card fraud, encompassing debit and credit cards, saw an 18.4% decrease overall.
Sabric CEO Nischal Mewalall said the private sector, government and civil society needed to urgently collaborate to combat rising financial crime.
“The commitment of organisations like Sabric to bolster law enforcement capabilities, fortify regulatory frameworks, and promote transparency and accountability is unwavering,” he said.
