As much as it is beneficial, the online to offline industry is not always safe from fraudsters. Recall a 6-year-old fraud case that involves an O2O commerce app, KUDO, where fraudsters skimmed money from the bank.
In that case, two fraudsters made a number of transactions through the KUDO app that were paid into the bank’s virtual account. The balance, however, was not deducted from the KUDO app, allowing them to make purchases as much as they want.
This case shows the daunting reality of how vulnerabilities in O2O industry apps could destroy businesses financially if left unchecked. Hence, those who have such a business need to know what to do to keep the service secure.
Common O2O (Online to Offline) Fraud & Attack Types
There are plenty of ways fraudsters can attack the online to offline industry to take advantage, other than the example above. Let’s delve into how they commit the fraud by using these multiple attack types:
App Forgery
Modifying an application is always a good start for any fraud. App forgery could be used for account takeover (ATO) or any fraud that involves stealing data from the victim. Here’s how fraudsters forge an app:
- First, the fraudsters find the targeted published regular O2O application, either from official or third-party markets.
- To modify the code inside the app, they have to unpackage, decompile, and analyze the source code for vulnerabilities.
- Once they find one, they modify the code to fit with their goals. For example, they want to steal the victim’s personal data by injecting malware into the app.
- Lastly, they recompile, repackage, and then republish the now-forged app back to either official or third-party markets.
Proxy Apps in Untrusted Environments
O2O services sometimes include a delivery service to deliver the product for users who made the online purchase. For example, KUDO, now owned by Grab, lets people be a licensed driver through GrabKios.
However, a driver could spoof their location to fill their quota faster. To do this, they can use proxies to hide their real location. Since it is often not restricted to use by country, anyone could easily spoof their location.
Not only can this give an unfair advantage to other drivers who want to play fair, but it also can tarnish a business’ reputation. What makes a tarnished reputation sound horrible is that it takes a long time to regain the trust.
Source Code Theft
While there’s indeed an open-source code, businesses prefer to keep theirs confidential. This is because if the O2O app’s source code gets stolen, anyone would try to find its vulnerabilities.
Source code theft could harmfully damage O2O business’s finances and reputation. Worse, the source code could end up in the hands of a competitor, making the situation much worse for the affected business.
Reverse Engineering
Reverse engineering online to offline industry’s apps is not impossible. Fraudsters could reconstruct the app to gain sensitive information like codes and paths to the back-end servers.
Reverse engineering is deemed unlawful if it’s used for committing a fraud or the app is illegitimately obtained. Much like app forgery, fraudsters can also inject malware to steal the victim’s login credentials.
Keypaz: The Best Solution for O2O (Online to Offline) Fraud Prevention
Now that you learned the dangers of O2O fraud, what is online to offline’s best protection a business can have? Worry not, Keypaz is here to help your O2O business to stay protected.
As a fraud prevention solution, Keypaz utilizes the best tools, such as device intelligence, app insights, and biometrical behavior analytics. These cutting-edge tools will help the online to offline industry to combat fraud by:
- Identifying fraudulent app installations or untrusted environments using behavior analytics. This prevents app forgery and application from being reverse-engineered.
- Blocking devices that might fake their real location using proxies and VPNs with geolocation spoofing and VPN detection.
- Detecting a sudden location change and changes in usage pattern with behavior analytics, preventing account takeover in the O2O industry.
Keypaz provides real-time protection to ensure the chance of committing O2O fraud stays slim. Without this solid protection, your business doesn’t stand a chance against constantly evolving fraud that waits for a chance to strike.
Key Takeaways
O2O online to offline business is often shrouded in the promise of a good financial future. However, that future also comes with a high risk that is ready to destroy O2O businesses.
This is why O2O businesses need to implement real-time protection like Keypaz as a barrier to stand against those frauds. Try Keypad as your only online to offline industry fraud prevention now before it’s too late!