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advocacy community education
omputing evolved from main-
frames to desktops, then laptops
to tablets, becoming more "per-
sonal" with each leap of evolution. Most
users of these devices today simply
access the Internet, social platforms,
email, and commonly used programs
via inexpensive "apps" which they can
select and install on their handheld
devices almost instantaneously.
The world of shopping obviously
changed as well, maximizing this same
The "Paperless Purchase"
Visit an Apple store, and no paperwork
will be completed, provided ...
or required.
The customer and purchase informa-
tion enters the associate's phone, the
seller and buyer complete the sale,
the associate swipes the customer's
credit card on the same phone, and
emails the receipt to the customer.
The sale is finalized, and the customer
leaves only with their purchases ...
and virtual receipt.
Several recent news stories have
detailed the ease with which new apps
will create opportunity for the commis-
sion of financial crimes. In particular,
three apps due out this summer cause
me concern regarding the potential for
new financial crime.
"Touchy-Feely" Phones
The first new app allows smartphone
users to click (or touch) two phones
together to transfer funds from one
phone to another. As demonstrated,
one smartphone user prepares a
transfer on his or her smartphone,
while the second user accesses his or
her bank account. The users click (or
touch) their phones together, and the
funds transfer from the first user's
account to the other user's account.
Will this ease of transferring funds re-
engineer robbers' techniques, who
could now stalk an individual, demand
the victim queue a transfer on his or
her phone, touch phones together
(moving the funds into a fictitiously
created account), and abscond with
the victim's phone? While the victim
tries to seek assistance from law
enforcement, the perpetrator could
transfer the funds back out of the
account, or simply withdraw the funds
via an ATM or other method in real
time, likely before police even arrive for
the initial complaint.
"Check" Your Photos
The second new app will enable users
to snap a picture of a check to be
deposited, transfer the picture to their
bank, and receive funds into their
account, just as if they took the physi-
cal check to their bank and manually
deposited it.
Efficient? Absolutely!
My concern lies with stolen, altered,
and counterfeit checks. Will this new
app make it even easier for an individ-
Smartphones, New Apps (Every Day!),
and Their Related Potential for
Financial Crime
By Stephen Pedneault, CPA, CFE, CFF, FCPA
iPhones, iPads, Blackberries, Androids, tablets, and all their related
devices released almost weekly have driven most users' computing
habits to the world of wireless. It's a double-edged sword.