Digital Avenger: Boaz Valkin demonstrates some of Falkin’s security tools to help people stay safe from online scammers.
Richard Behar
On an ordinary day in 2024, a 71-year-old retired teacher in Johannesburg lost a significant amount of his net worth in a phone call. It started with a text message warning of suspicious activity in her bank account. She was instructed to call a phone number (which differed by one digit from the bank’s real number) and the man who answered the call pretended to be from the bank’s fraud department.
He directed her to a website to confirm her account details to “make sure they were safe”. It was a near-perfect replica of the bank’s real website that she was familiar with. She has been a customer of the bank for more than thirty years. The thief emptied the account of all the money.
Her son, Boaz Valkin, now 34, did what any loving son in the tech industry would do: He started a company to build security tools for banks, embedding them into trusted apps and websites, and those tools gave her protections she had never had. (In short, his company’s technology allows customers to quickly check URLs, phone numbers, messages and emergency requests.) “In a 12-month period, a dozen of my mother’s elderly friends were scammed in similar ways, mostly by posing as banks,” says Valkin, whose London-based digital security startup is called Falkin. (“Falk” is a game of falcon, a historical symbol of strength, and “kin” represents family.)
“I was motivated to do something,” he says, “and, you know, turn that pain into something that bank customers can fight back against. There’s a huge shame in fraud. For example, my mother said, ‘I feel stupid.'” Well, you are. no You fool, you are not alone. It’s very difficult and AI makes cheating very difficult to detect, so there should be no shame and no victim blaming. “
Valkin’s technology is being used by a number of regional and community banks across the United States. He put in $2 million up front, built a staff, and is now working on the next round of funding. Varkin said that on a recent trip to Texas, he encountered customers of small banks who were outraged by the deluge of suspicious messages they were receiving. “They trust their local bank and know the banker’s name,” he said. “But they don’t trust the internet, they don’t trust government, they don’t trust big tech. Ordinary people are just out there without a life raft. Customers don’t just want yes Security – they want Feel Safe. ” He recalled that a small bank client, a retired jazz musician, thanked him for turning the Varkin family’s pain “into something beautiful.”
The fight against bank fraud is as old as the internet, but this particular area of the industry is just getting started. That doesn’t mean there’s no competition. The tools Varkin provides banks “exist in moments of manipulation or persuasion, not moments of transaction,” he said. “Most technologies and solutions operate at the time of payment, the moment of a transaction when funds leave someone’s account. That’s usually too late. By that time, someone has already fallen victim.” Other innovative startups, such as Tampa, Florida-based Scamnetic, offer similar tools.
Estimating the amount lost in online/digital scams is notoriously difficult. The Global Alliance Against Fraud (GASA), based on surveys of tens of thousands of people in dozens of countries, extrapolates the total annual amount to about $1 trillion. The FBI estimates that at least $16 billion is lost each year based on more than 860,000 victim complaints, the vast majority of which are filed in the United States. The problem with trying to get U.S. totals is that the country doesn’t have centralized reporting on digital fraud and scams, unlike countries like the U.K., where there is a central database.
Additionally, prosecutions for these scams are rare due to chronic underreporting for a variety of reasons—from the shame and embarrassment Varkin’s mother feels to the belief that reporting will not get her money back (which is often true). Beyond this, there are global questions about how and where financial flows are pursued, especially when much of it is converted into cryptocurrencies and ends up in countries that do not assist Western law enforcement.
One potential sign of hope: Last week President Trump signed an executive order titled “Countering Cybercrimes, Fraud, and Predatory Programs Targeting United States Citizens.” He wants closer coordination with financial institutions and a government-wide crackdown on cyber fraud and scam centers, especially transnational criminal groups that carry out large-scale online fraud (phishing, investment fraud, impersonation). If the White House is serious about it, this could have a positive impact on the problem.
Varkin spends a lot of time conducting research by exploring the dark web and other platforms used by criminal groups. “The conditions there are horrific,” he said. “Scammers no longer hack banks. They franchise. Different criminal gangs coordinate with each other on communication platforms, buy and sell technology to each other and divide victim profits. Artificial intelligence is also rapidly increasing the deception capabilities of visual text and speech. “
In fact, voice cloning technology is so advanced that Varkin said that when the caller’s identity is unknown, he will not pick up the receiver and speak until the other party picks up the receiver and speaks. This is because, with today’s technology, criminals can build usable “full vocabulary” clones using sounds of less than 5-20 words.
Falkin security inspectors are scanning a text message purportedly from E-ZPass. Result: “High risk – Detected fraud patterns include urgent payment requests, unofficial links and impersonation…Do not click on links…”
Richard Behar
Ten years ago, a relative of mine—my Aunt Hannah—received a call from someone pretending to be a jail bail bondsman, a fairly common scam. He told her that her nephew (who gave his correct name) was arrested, that his father (who also gave his name) could not be reached, and that a $2,000 bond was required. Aunt Hannah barely had two nickels to rub against. But she frantically wired the money and never saw them again.
Today, artificial intelligence is being used in such scenarios to generate entire scripts in a matter of minutes. Given the development of voice cloning, the con on Hannah today could easily include the voices of family members asking for help. (Tip: Create a secret family password in this situation, and don’t give out many family details, especially voices, on social media.)
Last summer, Varkin discovered an online investing club that turned out to be a pump-and-dump Ponzi scheme that caused the value of a Nasdaq company’s stock to plummet. Screenshots show the club was active through at least July. Quoting a professor who doesn’t actually exist. A woman who looks like a model provides updates on stock prices, and a faceless woman whose avatar is a mansion. Lots of fire and fist pumping emojis. The total return rate is as high as 255%! A celebratory dinner was arranged, to which all investors were invited. By August, the website disappeared; the phone number is meaningless today. Many such investment clubs flourished.
The dark web also shows that website phishing kits, such as the one that defrauded Valkin’s mother, are being sold openly, with subscription prices as low as $50 per month and as high as $1,500 for the highest quality layouts. In 2024, the FBI and Europol dismantled a large phishing kit enterprise called LabHost. But within months another entity emerged, and it is now publicly positioning itself as LabHost’s successor, according to the cyber threat intelligence firm. This is whack-a-mole.
Of course, fraud and scams have been around for as long as there has been human contact. The earliest recorded scammer was a man named Ea-Nasir, who made multiple deliveries of substandard copper around 1750 BC while receiving full payment – a kind of bait and switch. At least that’s what the clay “complaint” board says.
Fast forward: While Ponzi king Bernie Madoff didn’t use a clay tablet, he perpetrated the largest and longest-lasting financial fraud in history, but he did so with low technical proficiency. (He once boasted in prison that his mastery of high technology was so bad that “a running joke within our company was that I would never realize that my computer keyboard was disconnected.”) Investors received monthly statements via snail mail; two of Bernie’s programmers used nearly obsolete software programs on outdated IBM computers to create fake stock trades.
Today’s digital investing and banking initiatives are powered by artificial intelligence and are changing at an alarming rate. In today’s Ponzi world, Bernie will be left in the dust. “Bernie existed in the era of face-to-face conversations and phone calls,” said FBI Special Agent Paul Roberts, a member of the team that investigated the Madoff case. (He is now the special agent in charge of the bureau’s New York office.) Now we have Internet chat rooms, social media — we have artificial intelligence technology that you can use to mask investor voices. These are some of the differences that increase the complexity of techniques and exploits to further establish lies. “
Still, Roberts thinks there are more similarities than differences between then and now. “There are always things that are too good to be true,” Roberts said. “Guaranteed, consistently or unreasonably high returns are another sign. What’s new in this environment and completely opposite to how Bernie operates is a sense of urgency with which you invest.”
Roberts, who previously served as chief of the office’s complex financial crimes unit, likened today’s environment to the high-pressure sales boiler room pump-and-dump era of the 1970s and 1980s. “‘You need to take action today. you need to take action although I’m on the phone with you. Within ten minutes, the chance may be gone. you will miss Your chance. This is a huge red flag because they want you to invest your money without thinking about what you’re actually getting yourself into. That’s when you take a breather. “
or a beat. In 2024, the FBI launched a national “Take a Beat” campaign to combat online fraud—from deepfakes and phishing, to fake government calls, to bank account scams. The campaign utilizes social media advertising as well as educational outreach to schools and businesses.
Many banks and credit unions are marketing “Take a Beat” materials to customers, asking customers to take the time to check the legitimacy of a business and think critically before sharing personal information, sending money and clicking on links. When online investors or bank customers are robbed, the funds are often converted into cryptocurrency and flowed into a seemingly endless maze of “crypto wallets,” which is likely the journey Boaz’s mother’s savings took.
