South Africa is witnessing a new crime trend where victims are kidnapped and coerced into making transfers from their banking apps, often under the threat of violence. These incidents are on the rise, with different syndicates operating with their own targets and modus operandi. Some victims are forced to make payments outside of the country, making tracing funds nearly impossible for law enforcement. Others' accounts are used to make online purchases both locally and across South Africa's borders. In another example, multiple digital wallet payments or account transfers are made to a local recipient by syndicate members holding the victim hostage while other perpetrators drive around and make withdrawals at ATMs as quickly as they can.
Common banking app protection features such as Pins, biometric authentication, and facial recognition prove to be ineffective in these cases. In an app kidnapping, there is little one can do, similar to someone forcing someone at gunpoint to withdraw cash using their own card and Pin at an ATM. To combat this issue, some people recommend keeping only enough funds in their transactional account to cover immediate expenses and placing the rest in a seven-day notice account. If urgent access is needed, an 'early breakage' can be activated, but funds will only be available the next day.
Banking app shakedown syndicates are discerning in their choice of targets, often targeting individuals more likely to have a sophisticated account profile with more banking products and money in those accounts. Kidnapping cases can affect anyone, but generally speaking, those higher at risk include children, business owners, high-income individuals, those living alone, and newcomers to South Africa.
Detecting and stopping a banking app shakedown in progress is difficult, and tracking stolen funds after the fact often leads nowhere because law enforcement may know where the money was withdrawn. Consumers must be aware of how these criminals operate and take necessary precautions to prevent kidnapping.
In case of a banking app shakedown, victims should cooperate, stay calm, memorize details, stay passive, comply with demands, and seek help later. The South African Banking Risk Information Centre (Sabric) tracks banking-related criminal activity and reported a 9% reduction in reported mobile banking fraud incidents in 2022. Additionally, incidents involving Sim swaps declined from 87% in 2021 to 76% in 2022, indicating a waning efficacy of this fraudulent tactic.
