How South Africa is fighting financial fraud: an FSCA perspective

As the financial sector evolves, so too does the nature of the risks we face. Fraud is no longer a peripheral concern that can be handled through routine controls. It has become a systemic threat, one that targets our institutions, our consumers, and the trust that underpins the entire financial ecosystem. The shift to digital services, rapid adoption of fintech, and the pervasiveness of mobile transactions have expanded opportunities for innovation, but they have also expanded opportunities for exploitation.

The data speaks for itself. According to the South African Banking Risk Information Centre (SABRIC) Annual Crime Statistics 2024, there were nearly 98,000 digital banking fraud incidents in 2024, an 86% increase from the previous year. Losses amounted to a whopping R1,88 billion. This steep escalation tells us that fraudsters are moving faster, adapting quicker, and exploiting vulnerabilities across multiple platforms with far greater sophistication than before. The risk has become integrated into the digital infrastructure we rely on.

Artificial intelligence (AI) has intensified this pressure. Fraudsters now use AI to generate convincing deepfakes, clone voices, and construct synthetic identities. When prominent South Africans are impersonated in online scams, it reinforces a worrying reality: behavioural manipulation has become as powerful as technical intrusion. The threat now sits at the intersection of technology, psychology, and social engineering. This presents layered risks, which are operational, reputational, and systemic in nature.

International Fraud Awareness Week (16-22 November 2025) is a timely reminder that fragmented responses only broaden the risk surface. This year’s theme, Fraud prevention is a team effort – don’t sit on the sidelines, captures the core of effective risk governance: collaboration. Banks, insurers, fintech companies, telecom providers, social media platforms, law enforcement, and regulators each hold part of the puzzle. When these components operate in silos, criminals exploit the gaps between them. A coordinated, intelligence-driven approach is no longer aspirational; it is necessary.

Technology offers powerful defences, from machine learning to anomaly detection, but these tools introduce their own risks if deployed without proper oversight. As fraud attempts become more automated, our responses must be guided by strong governance frameworks that ensure AI is transparent, auditable, and responsibly managed. Inadequate oversight can lead to false positives, biased models or systems that criminals learn to bypass. Innovation without governance simply shifts the risk rather than reducing it.

Consumers remain a central part of the sector’s risk posture. When individuals lack the knowledge to verify financial providers, recognise suspicious patterns, or challenge unrealistic promises, the entire system becomes more exposed. This is why the FSCA continues to invest in initiatives such as Money Smart Week South Africa, the MyMoney Learning Series, and the Financial Literacy Speech Competition. Through these initiatives, the FSCA encourages consumers to:

• Verify the legitimacy of financial service providers through the FSCA’s online database.
• Be cautious of offers that promise unrealistic returns or apply pressure to act immediately.
• Protect personal and banking information, especially on social media and messaging platforms.
• Report suspected scams or unauthorised providers to the FSCA and other relevant authorities.

A more informed public reduces risk at its most common point of entry. 

Fraudsters rarely remain within one channel. A compromised password or an intercepted voice note can cascade into multiple forms of financial abuse. This cross-channel mobility means the risk is interconnected, and so must be the response. The FSCA continues to encourage structured intelligence-sharing, aligned reporting standards, and stronger sectoral coordination to ensure fraudsters cannot use one institution’s weakness to breach another.

Inside organisations, employees remain both a safeguard and a vulnerability. Without updated training, even experienced staff may overlook signs of AI-driven impersonation or sophisticated social engineering. A strong risk culture requires more than policies; it requires continuous awareness, accountability, and clear lines for escalation.

Fraud Awareness Week serves as a reminder that risk management is not an administrative task; it is a shared responsibility that protects the integrity of the financial system. Every stakeholder has a role to play: to verify, to question, to escalate, and to report. When one weak point is left unaddressed, it becomes a gateway for broader harm.

The FSCA remains committed to strengthening governance, supporting responsible innovation, and working with industry to reduce systemic exposure. Fraud will continue to evolve, but so will our defences. Let us act collectively, remain vigilant, and prioritise resilience at every level of the financial system.

* Mpete is the chief risk officer at the FSCA.

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