KUALA LUMPUR: Identity theft is still a major issue for over 25 per cent of Malaysians when it comes to financial crime, according to FICO's most current global consumer fraud report.
This form of fraud entails additional risks beyond monetary loss, including compromised credit ratings and the arduous process of reclaiming financial security, said CK Leo, FICO's head for fraud, security, and financial crime in the Asia Pacific region.
About 32 per cent of the respondents expressed worries about inadvertently sending money to criminals.
Leo said this poses a significant threat as such losses are usually irreversible and seldom reimbursed.
Malaysia is rapidly embracing real-time payments, with 92 per cent of adults having already made such transactions and 55 per cent planning to further increase their usage in the coming year, he said.
"As the adoption of real-time payments surges, driven by platforms like Boost, Touch & Go (TnG), and GrabPay, we're witnessing a transformative shift in financial behaviour. Yet, amidst this rapid digitisation, there is an urgent need for heightened vigilance against fraudsters lurking in the digital realm," he said.
FICO's research from the previous year revealed a concerning trend concerning authorised push payment (APP) fraud and real-time payments in Malaysia.
An alarming 76 per cent of Malaysians said they have received unsolicited text messages, emails, phone calls, or other outreach that they believed to be part of a scam, while 54 per cent of respondents stated that their friends or family members had been victims of a scam.
"Shockingly, 19 per cent of respondents admitted to sending real-time payments for investments, goods, or services they never received.
"And 41 per cent of those who made scam payments through real-time payments lost up to RM500, while 10 per cent experienced losses of up to RM7,500," it added.
He said that despite these alarming figures, only 28 per cent reported actual or suspected losses to their banks.
Leo emphasises that banks are currently at a pivotal juncture where they need to invest in advanced solutions to address the spike in scams, especially given the rapid adoption of real-time payments in the financial landscape of the Asia-Pacific region.
"The irrevocable nature of these transactions has led to new criminal threats. By integrating scam-specific analysis and scoring into transactions, along with robust decision-making capabilities across the customer journey, banks can pre-emptively detect and thwart scam payments, sparing customers from financial harm.
"Furthermore, while some consumers may ignore warnings, the majority will heed alerts and refrain from making real-time payments if alerted to potential scams," he said.