Regulator to ramp up efforts to detect, crack down on online phishing

Lead

South Korea's financial regulator announced this week a series of measures to intensify its fight against insurance fraud and online phishing. The Financial Services Commission (FSC) said it plans to set up an artificial intelligence-based insurance fraud prevention system this year and will strengthen inter-agency cooperation to detect and crack down on new types of online phishing crimes. The announcements come as the regulator reports significant financial losses from such scams and points to the growing threat posed by AI and deepfake technology.

Coverage Comparison

Both reports, published by South Korea's Yonhap News Agency, cover the FSC's latest anti-fraud initiatives. One focuses on the introduction of the AI-based insurance fraud prevention system, while the other details broader measures to combat online phishing, including upgraded detection systems and new insurance products. The two reports complement each other, with the first emphasizing the scale of insurance fraud and the second outlining practical steps to address phishing and protect victims.

Key Claims

According to Yonhap, the FSC plans to establish an AI-based insurance fraud prevention system this year, with a task force already launched to set it up by September at the earliest. The system is designed to respond to AI- and deepfake-based insurance fraud and to improve detection of new fraud types.

The regulator's data shows that some 1.15 trillion won (US$753 million) worth of insurance fraud cases were detected last year. However, the FSC warns that the figure could spike to 9 trillion won when undetected cases are counted.

On the phishing front, Yonhap reports that the FSC will institute regular, systematic cooperation among related government agencies to better detect and crack down on new types of online phishing crimes. Financial institutions and related agencies are expected to upgrade their existing fraud detection system this year to effectively spot such crimes and mule accounts, as well as share related information.

Starting next month, financial accounts suspected of being linked to new types of phishing crimes — such as romance scams — will be swiftly frozen, according to the FSC. Additionally, voice phishing insurance products will be rolled out, among other products, to better protect victims of phishing crimes.

The reports also highlight the performance of the AI-based Phishing Sharing and Analysis Platform (ASAP), which was launched in late October. The platform has prevented approximately 47.5 billion won (US$31.5 million) in financial losses from voice phishing scams over the past six months. During that period, the FSC said 317,000 cases of voice phishing-related information have been shared among financial institutions, and transfers from 5,261 accounts have been halted.

Phishing, as defined in the reports, is a type of crime where victims are conned into transferring money to scammers or sharing their personal information, thus allowing fraudsters to access their bank accounts.