Here’s a pretty interesting fact, criminals are targeting family offices and are apparently extracting tens of millions of dollars from them. But, when you think of it, it’s hardly surprising.
Asked why he robbed banks, the serial American bank robber Willie Sutton replied: “because that’s where the money is”, or, at least, that’s how the legend goes. So it would appear to be the case with family offices, which are facing regular attacks from cyber criminals, because that’s where the money is.
Not only that, it appears that family offices are easy targets and aren’t paying enough attention to security. The security company Kroll reckons that high profile individuals, often linked to family offices, are particularly been targeted in an area of crime that has shot up in recent years. The most prevalent cybercrime method being used is hacking into email accounts, says Kroll.
“The members of the family office most often targeted and therefore particularly at risks are the children of the principals,” says Benedict Hamilton, who works for investigations and disputes at Kroll. Hamilton relates a story involving a daughter from a very rich family with an investment office.
Kroll was engaged by the family office to investigate a series of payments which had been made by his daughter to unfamiliar accounts. The total value of the payments was over £200,000. The payments had apparently been requested by the daughter over email to the family office. But the daughter claimed that she had never sent the email requests.
“Our investigation revealed that the daughter’s email account, in this case a Gmail account, had been taken over by a hacker,” says Hamilton.
Kroll says that family offices aren’t doing enough to protect themselves. But, even when they are, it’s easy for cyber criminals to pick up on some information that can open the family/family office up to being hacked and money stolen.
“A successful family may spend large sums every year on security and cyber-security to ensure their privacy, but all it can take is a family member using social media to share which airport they are in and where the family are going,” says Stephen Ross, head of fraud at the law firm Withers.
Just like the banks got smart to the likes of bank robbers like Willie Sutton it would appear that family offices need to get smart with their modern day equivalent, otherwise they will keep on being targets, because that’s where the money is...