According to the latest report from PwC India, the outbreak of the pandemic has led to an increase in platform fraud, which includes fraudulent activities related to social media, e-commerce, enterprise and fintech platforms. The report, titled “Platforms: The New Frontier of Fraud in India,” states that the rise in remote working, aided by the increased use of e-commerce, deliveries and contactless payment applications, has led to a rise in fraudulent activity in the country. Of these, 57% of this activity is due to platform fraud. The report calls platform fraud a new economic crime and says that more than 26% of Indian organizations have lost over $1 million to platform fraud.

The survey was conducted among 111 organizations, half of which had sales of more than $1 billion. Of the companies surveyed, 40% of companies lost between $50,000 and $1,000,000 through platform fraud. Up to 17% of respondents lost between $1 million and $50 million, while 5% of businesses lost $50 million or more to platform fraud.

“During the pandemic, Indian consumers and organizations have been quick to adopt new platforms. Today, an average Indian company operates five platforms in the normal course of business. Therefore, the frequency of platform fraud is much higher in India,” says Puneet Garkhel, Partner-Risk Consulting and Leader-Forensic Services.

Enterprise platforms are a prime target for malware, phishing, money laundering, and ransomware. Financial fraud involving transactions to or from platforms accounted for 89% of all platform fraud cases. Payment fraud, particularly via credit cards and digital wallets, accounted for 92% of all customer fraud cases in India.

According to the report, 99% of fraud incidents in the last 24 months occurred on platforms such as finance, social media, goods, business, media sharing, knowledge sharing and services. White-collar crime and fraud remains a major challenge for Indian businesses, with 66% of organizations having experienced at least one form of white-collar crime in the last two years.

Among the identified platform fraud motives, financial gain is the most common: 44% of perpetrators in India engage in such activities for financial reasons. Brand damage is another common motive cited by 32% of the companies surveyed, followed by competitive advantage at 21%.

“Indian consumers and organizations have been rapidly embracing new platforms in recent years. On average, an Indian company today operates on five different platforms as part of its regular business activities. The emergence and rise of e-commerce, contactless payment, home delivery models, remote working, etc. have not only led to various platform-based innovations, but also opened up avenues of access for fraudsters. Businesses need to be aware of these evolving threats and invest appropriately in fraud prevention and detection strategies to protect themselves,” says Garkhel.