Internet-related crimes, seen as copycats of the infamous 'Nigerian prince-style' fraud schemes, have surged dramatically in Hong Kong. Cybersecurity and psychology experts have blamed conmen cashing in on people in dire financial straits amid the pandemic. 

The infamous "Nigerian prince" internet scams are not fading into obscurity. Tales of similar fraud schemes have cropped up from time to time, but the COVID-19 pandemic is being used as a weapon against any unsuspecting victim, or anyone who harbors rags-to-riches dreams.

The global public health crisis has provided fertile ground for fraudsters to take advantage of people's anxiety, stress, powerlessness and vulnerability to phishing tricks, particularly, in times of financial hardship, according to cybersecurity and psychology gurus.

Up to 12,900 technology-related crimes were reported in Hong Kong last year alone — a staggering 65-percent, year-on-year increase — with monetary losses of HK$2.96 billion (US$381 million). The number of internet criminal cases involving blackmail and ransom demanded or paid soared from 300 in 2019 to 1,144 in 2020, said Paul Yeung, senior inspector with the Cybersecurity and Technology Crime Bureau of the Hong Kong Police Force. Misuse of computer cases surged by 60 percent — from 71 in 2019 to 111 last year.

Often victims fell into a trap after accidently downloading malware or clicking on fraudulent hyperlinks.

At the height of the coronavirus outbreak, surgical mask-related scams were commonplace, Yeung noted with 2,500 reported cases involving losses of HK$74 million. "As people desperately needed face masks and sanitary supplies, imposters cashed in by offering victims whatever they required at, sometimes, incredibly low prices. So victims fell into the trap through mobile transactions and did not get what they had paid for," he said.

"The global health crisis has created an atmosphere, in which we truly believe there are more new opportunities to get rich, address urgent problems and help others," remarked Frank McAndrew, a social psychologist and professor at Illinois-based Knox College. Since these "opportunities" are so new, cautionary tales are absent, he said.

Tricks in pandemic

The pandemic has spawned a crop of new scams that dupe people out of money. Gareth Norris, a senior lecturer in the Department of Psychology at Aberystwyth University, United Kingdom, whose research focuses on online fraud, gives some examples of such criminal practices.

A "delivery company" would send out a text message to potential victims purportedly saying "We have failed to deliver a parcel to you due to border closures or disrupted airfreight services. But we can deliver it again tomorrow if you can pay just 50 dollars." A scammer impersonating a tax bureau officer would tell people they are entitled to a tax refund for having to work from home, and ask them to pay certain "fees" upfront. Fraudsters would also try to cheat people into paying for coronavirus test kits to enable them to travel, but the victims would end up getting nothing.

All these minted pandemic-fueled schemes appear so believable, Norris said. Such a "plausible narrative", as described in psychology, he said, is effectively misleading. "Put it this way, if you receive an email saying you have won 18 million dollars, you would swiftly dismiss it as a scam. But if it says 18 dollars, you will probably believe it. Although 18 dollars is a meager amount, it would add up to a decent figure if thousands of people comply."

Martina Dove, author of the book The Psychology of Fraud, Persuasion and Scam Techniques, observed, "The more credible and professional the fraudulent message appears, the more successful it will be."

Many people have come under severe financial stress amid the pandemic due to unemployment, bankruptcy or furlough. The urge to get out of their predicament is so strong that they can easily get cheated by fraudsters who promise them unrealistic loans. "When people are in dire straits, they are more willing to take risks because they have little to lose. This makes them vulnerable," Dove said.

Isolation and loneliness during city or national lockdowns have also forced many people, especially singles, to seek company through dating apps, fueling romance scams.

Among 1,988 social media deception cases were reported in Hong Kong last year, 905 of them involved "love" scams — a 52-percent increase over the figure for 2019 — according to Yeung.

Scams come in a myriad of categories, targeting different people. "They work by taking advantage of our psychological shortcomings," McAndrew said.

In cybersecurity, most of the scams revolve around "social engineering" — a tactic that manipulates people into divulging their private information through social interaction, said John Yuen Tsz-hon, assistant professor in the Department of Computer Science at the University of Hong Kong, who specializes in cybersecurity.

'Unrealistic Optimism'

Untangling the psychological tricks that conmen use to outmaneuver people and dissecting the psychological weak spots of hapless victims may help to make us more vigilant, sober and poised when confronted by such scams. "Unrealistic optimism about how things will unfold clouds our rationale," McAndrew said. "Research shows that most of us consistently overestimate our knowledge, skills, intelligence and moral fiber, which can translate into Panglossian confidence that things will develop as we hope."

These tendencies can be amplified when scammers nudge us to make immediate decisions. Many fraudulent schemes are orchestrated to elicit an immediate course of action to stop a purportedly imminent threat from happening or to gain an instant reward. In such a situation, our rational thinking is often overridden by emotion, McAndrew warned.

This gimmick works wonders when a "limited edition" twist is added, such as when a scammer fabricates a limited-time offer that makes the victim jump at it. "This is where the 'principle of scarcity' comes into play. Hijacked by the Fear of Missing Out mindset, we may think that passing up such a rare opportunity is a shame," said Yaniv Hanoch, co-author of The Scams Among Us: Who Falls Prey and Why. "Many people, therefore, are effectively cajoled into complying with what the scammer tells them to do. Again, under the 'clock is ticking' circumstance, our cognitive effort is sidelined."

Reciprocity or having a "give and take" mindset that we all learn by heart is also being exploited by scammers, Dove noted. "When they 'offer' us an exclusive opportunity or a special price, we take their generosity, we feel obliged to give and return the favor. It is the 'enforced indebtedness' mindset painstakingly deployed by scammers that edges us to agree to their request in return."

In the "mind game", conmen have gone the extra mile with bogus messages to increase their chances of success. When a tipster presents a veneer of an endearing friend, people are more likely to be captivated, which explains why "scammers try to cultivate a relationship and trust before going in for the kill", McAndrew explained.

Scammers frequently utilize the "foot-in-the-door technique" — a small, innocuous request — to attract their victims. Perhaps, it is something as simple as asking for advice on what to see while on vacation in evangelist Mark's home country. When the victim acquiesces, he or she perceives himself or herself as someone who is doing a favor for the scammer.

Through a series of baby steps, the victim would "switch from doing small favors that cost little to giving away the store," McAndrew said. In retrospect, a person might be skeptical and apprehensive. But why don't we reverse course even when the circumstances go awry? A well-known study — The Escalation of Commitment to a Failing Course of Action: Toward Theoretical Progress — conducted by Joel Brockner which was published in 1992 showed that people, rather than looking back, tend to have an irresistible urge to escalate their commitments to a failing course of action. Many other studies also have come to that conclusion.

"Changing course is cognitively difficult because not only is it an admission of a bad decision, it also means giving up any hope of recouping our losses," McAndrew argued. "So once someone invests money into something risky, whether it is a pyramid scheme or trying his or her luck at the casino, that person may keep throwing away the money because it seems to be the only way to get everything back."

Undiscriminating attacks

Phishing attacks don't discriminate, Norris contended, as everyone has an equal opportunity to fall for scams. The common assumption is that elderly people stand a better chance of being conned, while the well-educated are safer. But it is not the case as a matter of fact, McAndrew argued. "I don't think technological or social media savvy protects us; thinking of yourself as an expert may lull you into overconfidence that causes you to let down your guard."

Nevertheless, it is true that some people are more susceptible to certain types of scams than others. "For example, people with a history of giving to charity may be more likely to get scammed by someone asking for financial help in dealing with a tragic life situation. Gamblers are also more likely to fall for a scam that plausibly promises to help them get rich," he said.

Hanoch argued that scammers just send a fraudulent message to millions of users. Those who actively respond are deemed as the most vulnerable and would be put on a "suckers list".

While the internet has injected a real kick into our lives and is seen as a bounty to humanity, it exposes us to immeasurable danger on the flip side. The internet acts as a crutch for scammers, Dove said. Before the advent of the internet, scammers had to invest much time, money and efforts and expected only a small return, she said. Emails increase their odds of succeeding, and reduce the risks of being prosecuted "because jurisdiction is not clear", Dove said. With the help of social media, fraudsters are able to engage themselves in a legitimate group discussion, pretending to rave about a product to get others on board. "This is known as 'social proof,' making the fraudulent offer seem valuable to others or (that it) has the backing of other people."

Social media has greatly exposed people's privacy. It enables malicious people to use the very personal information they have to frame their scam messages to sound more familiar, relevant and individualized. This is called "spear phishing" — a highly personalized phishing attack.

People's habitual use of smartphones also makes them more susceptible to scam compliance. Norris is conducting research to see whether people respond to scams through mobile phones more than on computers. The preliminary finding suggests that people are less likely to examine the details of a scam on a smaller screen. Besides, since we often perform too many tasks on our phones, the distractions just make us oblivious to the falsehood.

Just as the internet has become so popular, fraud has reached epidemic proportions, Dove said. Scams today are common across borders and involve a great number of nationalities, making it more difficult to catch the criminals, Hanoch said.

"The design of the internet itself didn't include cybersecurity decades ago. It is now being added to the internet protocols and, hence, there are vulnerabilities," Yuen said.

Dove expects technology to further propel fraud. "With artificial intelligence, I can see it being used to drive such scams. Just think about what a synthetic voice can do and how realistically it can mimic a real person. I can see banks being hit next, with scammers pretending to be genuine customers."

Yuen begs to differ, describing technology as "neutral", saying that: "It benefits both the attacker and the defender. It depends on how you use it. But no matter how technology evolves, the human factor remains one of the weakest links in a system," which is obvious in "social engineering" attacks, he said.

He admits that the consequences have become more serious since we are exposing more information and personal assets online. Although governments worldwide have joined forces in protecting people from cross-border scams, no authority is better than ourselves in fighting fraud — a consensus among experts. The bottom line is: "Don't engage with seemingly benign strangers."

"Don't give them even the smallest bit of information. Don't allow them to form a relationship with you," McAndrew advised. "Always remember that if something seems too good to be true, it almost certainly is."