Computer Fraud Issues - Assignment Example

?Running Head: Finance and Accounting Finance and Accounting Computer Fraud and Abuse [Institute’s Table of Contents EXECUTIVE SUMMARY 1 INTRODUCTION 2 DISCUSSION 4 Computer Crimes and Abuse 4 Computer Fraud 4 Various Computer Frauds 5 Spamming 5 Advanced Fee Fraud 6 Employment Frauds 6 Counterfeit Schemes 6 Credit/ Debit Card Computer Fraud 7 Investment Fraud 7 Phishing Fraud 7 Cyber Terrorism 8 COMPUTER CRIME STATISTICS 8 CONCLUSION AND RECOMMENDATIONS 12 REFERENCES 14 EXECUTIVE SUMMARY The availability of electronic resources has increased in the last three decades and has given rise to various new criminal activities. The advantage of using the electronic media has spun new criminal activities that include persuasive use of computer abuse and fraud. It has become challenging for the local and federal government to investigate and prevent crimes and offenses caused by the computer abuse as it has resulted in many social and financial losses over the years. INTRODUCTION Computer abuse is subject to taking advantage of electronic media to gain information and use it against the third party. The evolving technologies such as the expert use of smart phones, tablets, laptops, home computers have added the threat of new crimes every day. The criminal activities are encompassed by excessive use of technology and computer abuse, which have resulted in major social, cultural, and financial losses over the last two decades. The new dimension of criminal activities involves expert use of technology that is intelligent and technical that it can be even misread by the law enforcement agencies. For instance, a property crime on a larger scale involves fraud against the property of people without involving any physical contact with the people (Denning, 2004). The prevention of such crimes is essential for the future of advance technology and criminal investigations undertaken by trained computer experts or forensic individuals. The advancement of technology and awareness of computer abuse possess a serious threat for not only to individual but also to the nation’s security in terms of legislative and financial crimes preceded by computer frauds and abuse. It has also resulted in crash of financial markets, the great depressions periods and various money laundering cases, which is a threat for not only the national security but also preceded under anti-terrorism globally. The last three decades have given rise to various hacker groups around the globe who had attacked and invaded the financial market as well as the highly sensitive data regarding the national security. For instance in recent years, the wake of wiki leaks is a big example of computer abuse. It has resulted in releasing secret sensitive information and publishing documents that possess a serious national and financial threat globally (National White Collar Crime Centre, 2002). The emerging threats from excessive computer abuse have raised the scope of federal and local legislation in regards to larger crimes. The legislations and penalties are in place to combat the computer abuse and punish the offenders for misuse of information and data (Denning, 2004). DISCUSSION Computer Crimes and Abuse Computer crimes are defined as criminal activities committed in a technological environment in order to cause damage or derive economic gains from other others (U.S. Department of Justice, 2001). According to the adaption of Cohen Felson’s Routine Activities theory, a crime is determine due to the availability of a suitable target, lack of backing from any guardian and a serious motive by the offender. It was also stimulated that usage of computer adversely can result in invading the sensitive information and using it for criminal purposes (Gordon et al, 2003). It is also confided in law that intentionally or without permission, accessing the computer services or any device can result in committing a criminal offence (National Security Institute, 2004). The traditional crimes such as fraud, theft and organised criminal rings are now preceded with the electronic media in a sophisticated environment. The computer functions such as softwares and programmes are the most common abuse target, which are used to manipulate, and conductive criminal offences (National White Collar Crime Centre, 2002). Sometimes the target and victim are not related in such crimes as computer are programmed itself to cause the offence intentionally. It has also given rise to easy accessibility of online resources and documents that helps the hacking groups to use and misinterpret the information for criminal activities. Computer Fraud The deception caused using electronic media mainly the use of computers to misrepresent or falsify the information is alleged as computer fraud. This is one of the largest medium of committing fraud globally (National White Collar Crime Centre, 2002). The intentional misrepresentation, falsifying accounts, publishing misleading information, using sensitive information in order to commit financial or legislative crimes by the use of computers or electronic media is a qualitative source of computer frauds (Rantala, 2004). The electronic media is a new medium to conduct fraudulent activities in order to process transactions of fake accounts and bogus money accounts for the financial institutions on a large scale (Department of Justice, 2001). Various Computer Frauds Following are the various forms of computer frauds prevailing in the electronic medium, which has a serious impact globally. Spamming A form of bulk- mail that is delivered in large to the recipient for promoting any particular products or services is spamming. The purpose is to market a product at a lower price from the market and receive money in advance from the recipient or any other personal information such as credit card details. Once the information or money is received by the spammer then the targeted audience will never hear from them. A prime example is the case of Jeremy Jaynes who convicted spam emails over 10 million accounts and received approximately 10,000 to 17,000 replies in a month, which could result in making approximately $750,000 per month (AP, 2004). Another criminal fraud was conducted in Nigeria where an email was rotated about the son of Nigerian head of state. He is portrayed to be heir of million dollars and have accounts all over the world. The recipient will receive a small fortune if they pay the lawyer’s fee for few thousand dollars in order to claim their prize. Victims who have replied with their bank details never heard or seen any money (Koinange, 2002). Advanced Fee Fraud This is computer fraud that involves paying an advance significant fee in order to gain a large fortune. The fee is reportedly told as processing fee or taxation fee, which is charged and presumed to be legal. Personal details including the credit card numbers are asked to pay off the fee, which also results in misuse of personal details (National White Collar Crime Centre, 2002). Employment Frauds The fraud company post a wanted or employment job on a popular employment website. Candidates are required to fill in the credential personal information such as name, date of birth, and social security number. The information is further used for criminal activities as purchasing of good on credit. The goods are sent to freight forwarding and eventually shipped to some foreign country. The foreign company pays an enormous freight charge, which is then charged to the fraud company’s account before any whereabouts can be traced and fraud has occurred (National White Collar Crime Centre, 2002). Counterfeit Schemes It is a criminal offence to pay for merchandise from a fraudulent check or account. The alleged victims are asked to deposit a check in a foreign country’s bank account in order to get the merchandise. The seller deposits the money and wire the excess back to the buyer in order to pay the shipping fees. When the money is received for such a large amount, the purchase is usually cancelled and the buyer is held responsible for the counterfeit check by the bank (National White Collar Crime Centre, 2002). Credit/ Debit Card Computer Fraud The unauthorised use of credit and debit cards by any fraudulent websites is a very famous computer crime. The credit card details are stolen are used against the user to obtain huge amount of merchandise or money from the websites and is a modern from of theft using electronic medium. Investment Fraud A fraudulent claim by investors or loan companies to purchase or invest in forged securities. It is also alleged with raisin abnormal profits with little or no investments by the phony investors. At an early stage, the alleged victim is paid a small amount from their investment and then system collapse resulting in no dividends or any trace of initial investments (National White Collar Crime Centre, 2002). Phishing Fraud This is a very common and serious computer abuse where the fraudster pretends to be using someone’s email account or website. The web content of the original website is copied with the fraudulent website. The sensitive information such as name, passwords and payment details are revealed to the fraudulent website, which could then result in using the information for criminal purposes. It is popular crime among the auction websites (National White Collar Crime Center 27-8). An email is sometimes received asking for payment by a legitimate website, such as eBay or PayPal and the moment the victim try to click on the link or update his account on the website, such as credit card number, then it stores the information resulting in several dollars fraud by the phishing website (Krebs, 2004). Cyber Terrorism A serious computer crime, which involves using the electronic resources to attack the victim by forming networks, using, or publishing sensitive information and computer programmes that can intimidate legislations, government and other countries for a possible threat to their national security. The attack results in violence of property or lives of innocent people and in generating the heat of fear among people (Denning, 2000). COMPUTER CRIME STATISTICS The figures depict a comparison of year 2011 and year 2012 stating the origin and volume of computer abuse and spamming all over the world. (Source: Secure list, 2012) (Source: Secure List, 2012) The most targeted audience by spamming is originated in India, follow up by Indonesia and Brazil in year 2012. (Source: Secure list, 2012) The statistical information depicts the amount of emails with malcious spaming and othe fraudlent activies in year 2012. (Source: Secure list, 2012) Statistical information regarding phising emails in 2012 from January to March. The chart shows a decreasing trend. (Source: Secure list, 2012) The most famous phisiing sector by the fraudlers are financial institutions and banks as targeted in 2012 from Jan to April. (Source: Secure list, 2012) Financial instituitions and social networking sites topped the phising activities at 24.52% and 22.14% as compared to online stores at 18.64% and search engines at 14.87% According to 2008 survey of computer abuse and crime, the statistical date reveals the following : (Source: CFR, 2009) It shows that auction fraud and non delivery of merchandise has been the major computer crimes since 2008 at 32.9% and 25.5 % respectively. CONCLUSION AND RECOMMENDATIONS The computer fraud is a serious offence and legislations have been in place to monitor and investigate these offences and are a cause of decrease in certain criminal offences such as spamming, viruses, etc. The following recommendations will be essential for preventing the computer abuse and criminal offences in future: Statistical recording system will help to evaluate the trends and gaps in the criminal activities pertaining cyber abuse. It will also help to gather information regarding different crimes and their alleged victims by usage of standardize procedures. Once the information is stored it can shared with the legal enforcement agencies which have a clear understanding of the computer fraud and can prevent it further (National White Collar Crime Centre, 2002). Training and expert advice should be provided in order to counteract the attack from computer use. Computer hacking and technical expertise is required to investigate such crimes before they can occur or prevent their occurrence. It will help to officers to prevent such frauds and give them a better understanding of the situation (National White Collar Crime Centre, 2002). REFERENCES AP. 2004. Anti-Phishing Working Group. Anti-Phishing Working Group. Retrieved on December 5, 2012: http://www.antiphishing.org CFR, 2009. Computer Fraud Reporting, Crime Statistics 2009. Retrieved on December 05, 2012: http://www.consumerfraudreporting.org/internet_scam_statistics.htm Denning, D. E. 2004. Cyber terrorism: Testimony before the Special Oversight Panel on Terrorism Committee on Armed Services U.S. House of Representatives. Retrieved on December 05, 2012: http://www.cs.georgetown.edu/~denning/infosec/cyberterror Department of Justice. 2001. Russian Man Sentenced for Hacking into Computers in the United States. Retrieved on December 05, 2012: www.cybercrime.gov/ivanovSent.htm Gordon, G. R., Hosmer, C. D., Siedsma, C., and Rebovich D. 2003. Assessing Technology, Methods, and Information for Committing and Combating Cyber Crime. Retrieved on December 05, 2012: http://www/ncjrs.org/pdffiles1/nij/grants/198421. Koinange, Jeff. 2002. Internet fleecing scams thrive in Nigeria. Retrieved on December 05, 2012: http://archives.cnn.com/2002/TECH/internet/08/11/nigeria.scam/index.html Krebs, Brian. 2004. Phishing Feeds Internet Black Markets. Washington Post. National Security Institute. 2004. California Codes. National Security Institute. Retrieved on December 05, 2012: http://nsi.org/Library/Compsec/computerlaw/Californ.txt National White Collar Crime Centre. 2004. IFCC 2002 Internet Fraud Report. Retrieved on December 04, 2012: http://www.ifccfbi.gov/strategy/2002_IFCCReport.pdf Rantala, R.R. 2004. Cybercrime against Business. Bureau of Justice Statistics. Secure List. 2012. Spam in Q1 2012. Kaspersky Lab. Retrieved on December 05, 2012: http://www.securelist.com/en/analysis/204792229/Spam_in_Q1_2012 U.S. Department of Justice. 2001. National Institute of Justice Research Report. Electronic Crime Needs Assessment for State and Local Law Enforcement. National Institute of Justice. Read More