Situation Report: Attempted Fraud Using the hi Debit Card
27th January 2023. Authored by hi
On Saturday 21st January 2023, the hi Team flagged a relatively high volume of suspicious transactions using the hi Debit Card. The transactions were flagged as suspicious for the following reasons:
● Abnormal frequency of refund requests (including international)
● Abnormal value of refund requests
Upon further investigation, additional suspicious patterns were identified with these transactions, including:
● Age of hi accounts (they were newly created)
● Geographic locations of suspect accounts (4-5 of the same markets based on KYC,
including Latvia, Lithuania, Estonia, Italy, and Ukraine).
The hi Team quickly established that a large scale, and coordinated fraud attempt was in progress. Card processing and issuing partners were quickly notified of the situation.
Although several courses of action were considered, given the number of suspicious transactions identified, a consensus was reached that the most responsible response was to temporarily revoke access to the hi Platform and its Services (including Mobile Apps, Web App, and Card Services). Whilst inconvenient, this would not only prevent more bad actors from attempting to participate in the fraud, but also protect the hi Platform from potential loss of funds or related damages. We do not take this decision lightly, and it was done to protect the interests of our legitimate customers.
While the investigation is ongoing, It has since transpired that the methods used by the bad actors included gaining access to merchants or acquirers and triggering fraudulent transactions, including refunds to thereby illegitimately acquire funds.
Approximately 300 hi accounts are suspected of being involved. It is believed that the attempted fraud was promoted and coordinated via an external Russian language Telegram group. While our review of accounts continues, at this point the hi Team anticipates minimal loss of company funds, and we are in the process of recovering illegitimate funds transferred to other platforms. It should be reiterated that hi is fully solvent with all user assets in both fiat and crypto safe, accounted for, and backed 1:1, and the funds of individual
hi members were never at risk of exploitation. The hi Team is currently working with our partners to ensure that the correct systems and processes are in place to prevent such attempts in the future, and it is thanks to the fast action of the Compliance and Technology teams from all parties involved that this attempt was caught early.
Whilst many hi members experienced a frustrating few days with App downtime, the hi Team would like to take this opportunity to reiterate that any attempt at financial crime via the hi Platform will not be condoned, and will be reported to the relevant authorities where possible.
Service Status
As a result of the necessary action of disabling the hi Platform and Services temporarily, several services were affected. At time of writing, here is the current Service Status:
Mobile Apps: Active
Web App: Active
Crypto Deposits: Active
Fiat Deposits: Active
Crypto Withdrawals: Active
Fiat Withdrawals: Inactive
Debit Card: Inactive
We will provide frequent status updates via our official Telegram, Twitter & Email channels over the coming days, and will work with our partners to resume normal service as soon as possible.
We hope this report gives hi members a clear understanding of the course of events and measures taken over the past few days. Please reach out to us via official channels if you have any questions.
The hi Team
Voor de mensen die ook geband zijn in the Buyers groep!
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pending, pending, pending, pending
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Ik ga de docu dit weekend ook eens bekijken, thanks voor de tip! /u/1022079/crop61d4562bb3c40.png?f=community)
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