Criminals ‘using virus to rort and defraud’

Australia’s watchdog and crime agencies are combating a wave of COVID-19 fraud and corruption amid ASIC reports of a 20 per cent spike in misconduct claims.

The Crime and Corruption Commission Queensland, Australian Federal Police and Cyber Security Co-operative Research Centre also highlighted the digital evolution of criminal organisations during the pandemic as a major risk to Australians.

Australia’s corporate watchdog and crime agencies are combating a wave of COVID-19 fraud and corruption rackets, with the Australian Securities and Investments Commission reporting a 20 per cent spike in misconduct claims.

ASIC has said criminals were using the pandemic to exploit government COVID-19 stimulus programs, including the early release of superannuation and an increased demand from investors for higher returns.

The increase in criminal behaviour has been amplified by “online scams, identity fraud, cyber intrusions and the use of crypto assets to disguise the transfer of proceeds of crime”.

In its submission to a parliamentary inquiry into COVID-19 crime and law enforcement, ASIC said criminal groups were using the pandemic for financial gain.

“The COVID-19 environment — including use of digital lodgement of applications to facilitate prompt access to various elements of the economic stimulus package, including the Early Release of Superannuation scheme — has created opportunities which have been attractive to, and to some degree exploited by, serious and organised crime,” the ASIC submission said.

Between January and July, ASIC received 355 reports linked with COVID-19 and observed a significant “rise in the number of scam reports”.

ASIC is working with inter­national counterparts and security agencies to increase daily “environmental scans and intelligence gathering exercises” and was scraping social media, and monitoring blogs and news sites to identify criminal activity.

The corporate regulator said COVID-19 had “created difficult economic conditions for some companies and is likely to have provided opportunities for untrustworthy advisers to promote and facilitate illegal phoenix activity … ASIC anticipates a significant increase in external administration appointments.

“ASIC expects large volumes of often unfunded liquidations may place additional pressure on registered liquidators’ agreement to take on appointments.”

The Crime and Corruption Commission Queensland, Australian Federal Police and Cyber Security Co-operative Research Centre also highlighted the digital evolution of criminal organisations during the pandemic as a major risk to Australians.

The CCC — Queensland’s independent corruption watchdog — said COVID-19 had “introduced a sudden shift in the crime and corruption risk environment”.

“Activities of criminal networks are likely to have been disrupted by border travel restrictions, and new crime targets have emerged in the form of stimulus payments and access to superannuation, among others,” the CCC submission said.

“Just as legitimate businesses have had to innovate during the COVID-19 pandemic, it is likely that organised crime groups have innovated in their criminal activities.”

The CCC said the pandemic was creating opportunities that “may be conducive to corruption” through urgent procurement and recruitment processes and changing drivers for corruption risk via “unemployment, constrained opportunities for promotion and devalued personal investments”.

The AFP’s foreign interference and cyber teams are working with the Department of Home Affairs to “identify and assess all forms of malign information manipulation”, including misinformation, phishing and ransomware scams” related to COVID-19.