Business Risk

Risk assessments and threat intelligence on business risks that can impact corporations or businesses. Information about money laundering, corruption and other threats to business operations.

Australia’s government lost up to $1.1 Billion in tobacco tax revenue in 2012 due to cigarette smuggling activities.

Security agencies in Australia 82 million black market cigarettes in 2011. In 2012, the number of illicit cigarettes increased to 122 million.

2.7 billion cigarettes were smoked in the country in 2012 that were purchased without the payment of taxes, or 11.3 percent of all cigarettes smoked. Most of the contraband cigarettes were either smuggled into Australia from China or South Korea or produced in homegrown tobacco shops.

Source:  Lily Kuo, “Australia lost $1.1 billion because of illegal cigarettes last year,” Quartz, October 2, 2013.

In 2013, the global costs associated with cybercrimes against consumers was reported to be $113 Billion, according to a report by computer security firm Symantec.

The average cost per victim of cybercrime was $298, a 50 percent increase from the average costs in 2012. Consumers in the United States had the highest costs associated with cybercrime, with $38 Billion, followed by China with $37 Billion.

According to the report, there are 378 million victims of cybercrimes each year. The highest number of cybercrime victims were found in Russia, China and South Africa.

Nearly half of the consumers surveyed in the report do not use security precausions for their mobile devices, such as passwords, security software or file backups.

57 percent of mobile device users (tablets, smartphones) are unaware that security solutions are available for mobile devices.

Source:  “2013 Norton Report,” Symantec. October 1, 2013.

A survey conducted by accounting company PwC found that 18 percent of consumers in Britain admitted to purchasing counterfeit alcohol. 16 percent reported purchasing counterfeit drugs such as Viagra and weight-loss pills. And 13 percent admitted to buying counterfeit cigarettes.

British consumers between the ages of 18 to 34 bought the most counterfeits, with 60 percent saying that they bought pirated movies and music and 55 percent have bought replica clothing.

Source:  Rebecca Smithers, “Surge in purchases of counterfeit goods,” Guardian, October 1, 2013.

Cyber security researchers state that botnets are available for rent to boost a website’s traffic figures.

Through the monitoring of internet forums and message boards, security researchers state that Russian hackers will sell 1,000 visitors to a website for $1. The botnets are based on computers around the world, and the traffic sellers state that they can direct the traffic from any country.

The fake traffic is bought by website owners in order to increase advertising revenue. The botnets create fake page views and ad clicks in order to make it seem like a real-life visitor viewed the site and clicked on the ad. According to a report in the Wall Street Journal, the most sophisticated bots discovered by cyber security professionals found that the botnets can watch videos, pause at ads, and click on items to put it into the online shopping carts.

(Find other prices and services for sale by hackers.)

Source:  Christopher S. Stewart and Suzanne Vranica, “Phony Web Traffic Tricks Digital Ads.” Wall Street Journal, September 30, 2013.

In the first half of 2013, security officers in Germany seized 1.4 million counterfeit drugs. The number of fake medicines seized was 15 percent higher than the amount seized in the first half of 2012.

According to security experts, the profit margin for a counterfeit drug such as fake Viagra can be as high as 25,000 percent.

Source:  Heimo Fischer, “Fat profits behind steady rise in fake drugs worldwide,” Deutsche Welle, September 30, 2013.

A study by the International Tax and Investment Centre and Oxford Economics found that 900 million cigarettes were bought on the black market in Singapore. The amount of tax revenue lost to the government was estimated to be around $276 Million (347 Million Singaporean Dollars).

Based on the total amount of cigarettes smoked in Singapore, roughly one in four cigarettes smoked in 2012 was purchased on the black market.

Security agencies arrested 6,248 people for buying illegal cigarettes in 2012, an increase from the 5,977 arrested in 2011.

Source:  Joyce Lim, “1 in 4 cigarettes in Singapore illegal,” Asian One, September 29, 2013.

Tax enforcement officials in Malaysia investigated 175 cases of counterfeit cigarette sales in the country between 2012 through September 2013. The value of the black market cigarettes seized by security agencies was worth $36,000 (117,800 Malaysian Ringgit).

A legitimate pack of cigarettes with taxes included is sold for $2.17 (7 Ringgit). A counterfeit pack is sold illegally for $0.93 (3 Ringgit).

Source:  Bernama, “Smuggling of fake cigarettes on the rise,” New Straits Times, September 26, 2013.

Intelligence from security agencies  across Colombia estimate that nearly 150 different organized crime gangs  earn over $100,000 a month from various micro-exortion demands. In total, the amount of extortion money that gangs earn per year is over $1 Billion.

The gangs target various working professionals at a small rate. Media reports from Colombia state that teachers were paying $7.90 a month in micro-extortions to gangs in order to work. Bicycle taxis operating in Bogota must pay $1.50 per day.

In the town of Narino, security officials claim that 1,300 businesses were forced to shut down due to extortion attempts between 2011 and 2013.

(More illegal ways to make money.)

Source:  Natalie Southwick, “Colombia Micro-Extortion Targets Teachers, Bicycle Taxi Drivers,” Insight Crime, September 23, 2013.

In 2012, criminal justice agencies in Greece conducted raids against 1,000 establishments that were operating illegal casinos. The raids resulted in nearly 11,000 casino machines being seized and around 5,000 people for illegal gambling activities.

In the first 5 months of 2013, police closed down 363 illegal casinos in Greece. The raids in the first 5 months of 2013 resulted in 4,014 video lottery terminals being seized and 1,889 people being arrested.

Source:  Stathis Kousounis, “Illegal casinos depriving Greek state of considerable revenues,” ekathimerini.com, August 13, 2013.

An estimated 100,000 barrels of oil is being stolen each day from refineries in Nigeria.

The total value of the losses from oil theft in Nigeria is valued at $8 Billion a year. 90 percent of the stolen oil is smuggled onto vessels and shipped to foreign countries.

Previously, the reported amount of losses to oil smuggling in Nigeria was $6 Billion.

Nigeria exports 2 million barrels of oil each day and is the world’s 13th largest producer.

Source:  Roberto A. Ferdman, “How to steal 100,000 barrels of oil a day, and get away with it,” Quartz, September 21. 2013.