The number of fake and scam websites pretending to be reputable brands from the Middle East and Africa experienced a significant increase last year, according to a research report by Group-IB. The study found that instances of brand impersonation scams in the region rose by 162%, with a specific surge of 135% in the detection of fraudulent websites.
Brand impersonation scams are defined as instances where a cybercriminal appropriates a brand’s image and logo to deceive victims into voluntarily handing over money or sensitive information. Unlike phishing attacks, which involve the theft of personal information without the victim’s knowledge, scams directly involve the victim’s active participation in the deception.
Group-IB’s research also compared the Middle East and Africa region’s scam uptick with other regions. The report revealed that this increase was relatively lower compared to the Asia-Pacific region, which saw a staggering 211% rise in brand impersonation scam detections in 2022.
To carry out their fraudulent activities, scammers are utilizing a wide range of domains and social media accounts to reach a larger pool of potential victims while evading detection. One notable scam-as-a-service affiliate program, known as Classiscam, has experienced substantial growth. Group-IB has identified 1,366 Classiscam groups to date, with these groups emulating 251 brands from 79 countries. The financial damage caused by this scam scheme alone is estimated to be at least $64 million.
Additionally, Group-IB found a rapid increase in the number of scam resources hosted on the .tk domain. The .tk domain, which offers free website registration, was responsible for 38.8% of all scam resources examined by Group-IB in the second half of 2022. Scammers primarily create fake websites linked to on social media to increase their potential reach, often using numerous fake accounts to publish sponsored posts.
Social media platforms have played a significant role in the proliferation of scams, with 92% of scams impersonating Middle East and Africa companies leveraging social media platforms in 2022. This marks an increase from 80% in 2021, indicating scammers’ growing reliance on social media to carry out their fraudulent activities.
In terms of the affected sectors, Group-IB’s research discovered that finance, telecommunications, logistics, and oil and gas were the most targeted industries in the Middle East and Africa region. The financial sector was particularly susceptible, accounting for 74.2% of intellectual property violations, such as the illegal use of trademarks and misrepresentation of brand partnerships.
The alarming rise in brand impersonation scams is not exclusive to the Middle East and Africa region. Globally, Group-IB detected a 304% increase in scam resources that utilized legitimate brands’ names and likeness in 2022 compared to the previous year. The “2022 Global State of Scams Report,” published in collaboration with the Global Anti Scam Alliance and ScamAdviser, revealed that scams caused over $55 billion in damages worldwide last year.
As scams become more sophisticated and prevalent, it is crucial for individuals and organizations to remain vigilant and take proactive measures to protect themselves from falling victim to these fraudulent activities. Heightened awareness, education on scam detection, and implementing robust cybersecurity measures can help mitigate the risks associated with brand impersonation scams.