Singapore businesses adapting their operations to fight fraud and scams

SINGAPORE - Digital payment provider Xfers has been dealing with scams since 2015, when it found that fraudsters were using its e-wallet services to launder money from victims.

But the workload became too much for its compliance team to handle, so the local start-up created a dedicated fraud team last year to tackle the rising number of scams in Singapore and Indonesia, where it operates.

Xfers co-founder Samson Leo, 35, said the firm spent a six-figure sum last year on manpower and technology to fight cybercrime and fraud.

Besides building new app features, such as an additional verification step if a high scam risk is detected, the fraud team also analyses transactions to find insights on how scammers are operating and spot accounts that are being misused. The team has grown to more than 10 people.

Mr Leo, who is also Xfers' chief legal officer, said: "By preventing fraud, merchants and customers gain more confidence in digital payments. Digital payments are the future, and this is the right thing to do."

Other businesses have also made fighting scams and fraud a priority.

Firms in industries ranging from human resources to e-commerce said they are changing the way they operate in light of the proliferation of scams in the last two years.

Last year alone, scams cost victims in Singapore at least $633.3 million.

Businesses, too, feel the pinch in terms of lost productivity and trust.

Recruitment firm Randstad discovered this year that fraudsters were impersonating its recruiters in job scams on messaging platform Telegram after retrieving their full names and registration numbers from the Manpower Ministry's employment agency directory.

It even received some complaints from people about the unprofessionalism of its "consultants", who were actually scammers.

The company now requires all its recruiters to use only WhatsApp and WeChat to converse with job seekers, said a Randstad spokesman.

She noted that unlike on Telegram, WhatsApp users can see each other's mobile numbers, so job seekers can call to check the legitimacy of the recruiter since scammers are less likely to answer the call.

Meanwhile, the Central Provident Fund Board, whose SMS about ElderShield last month caused confusion as it contained a clickable link that some recipients thought was a scam, will avoid links in SMSes where possible.

Alternatively, it will convert them so that the links do not lead directly to a page requiring login credentials, said a spokesman from the Board.

Firms have also stepped up their efforts to educate consumers about scams.

In the first quarter of this year, tech giant Meta worked with the Media Literacy Council and the National Crime Prevention Council to launch a public education campaign centred around how to shop safely online.

The campaign reached 2.2 million Facebook and Instagram users in Singapore.

Mr Daryl Poon, regional head for trust and safety at Meta said: "Education is important because users need to understand how to recognise some of the risks in the online space. Once you understand the risks, you are less likely to fall prey to malicious actors."

Ms Anna Yip, chief executive officer of Singtel's Singapore consumer business, said Singtel sales representatives distribute pamphlets with information on ways to identify a legitimate representative.

For instance, they will wear a Singtel uniform and have an authorisation letter and will not enter homes nor collect any form of upfront payment, according to a pamphlet seen by The Sunday Times. Singtel did not say when the distribution began.

This comes as the police said last Tuesday that at least 154 victims have lost $7.1 million to tech support scams since January. One method used by scammers includes calling victims and posing as staff working for Internet service providers such as Singtel.

Staff and drivers from logistics company Ninja Van Singapore have also been distributing fliers to migrant workers and domestic helpers to raise awareness of cash-on-delivery scams. These ruses see customers being asked to pay for parcels they did not order or which do not match their expected purchases.

Chief operating officer Lee Ghim Hock said: "It is heavily in our interest to promote consumer awareness and education, as the productivity loss due to time spent on scam cases is significant and ever-increasing as the e-commerce industry grows."

Professor Lawrence Loh, director of the Centre for Governance and Sustainability at the National University of Singapore Business School, said being linked to scams impacts businesses' reputations.

"Once this is affected, consumers may lose their trust in such businesses. Ultimately, the bottom lines of the businesses will be jeopardised when revenues are lost," he said.

He added that it is critical for businesses to play a front-line role in preventing fraud because they form a crucial line of defence for consumers, who often bear the burden in scams.

Xfers' Mr Leo noted that as more safeguards are set in place to protect customers, the speed of transactions could slow down.

"Some legitimate users may be delayed, but it is a trade-off we hope customers will understand," he said.