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 Markus is a private wealth lawyer assisting global wealth owners, entrepreneurs, and their families in navigating the complexities of wealth management, wealth planning, estate planning, family offices, and digital assets. He is qualified to practice in Switzerland, Liechtenstein, and Austria and is the founder of Centro LAW, a wealth management and family office law firm based in Zurich, Switzerland. Markus also specializes in financial products and digital asset regulation as well as in financial and white-collar crime, with extensive experience in blockchain and AI. Crime follows money, and technology multiplies it. Crime-as-a-service toolkits, deepfakes, and scalable infrastructure enable cybercriminals to target thousands simultaneously, while still tailoring convincing messages for individual victims. This article maps today's threat landscape and shows why high-net-worth individuals and their family offices are in the crosshairs. Fraud has a history stretching back centuries and was already classified as a criminal offense in ancient Rome. With the rapid digitization and advancement of artificial intelligence, we are experiencing an unprecedented scale of deception and financial loss as cybercriminals industrialize their operations. They target specific vulnerabilities of their victims. And who better to target than the wealthy? On the one hand, there is the lure of a large haul, and on the other, helpful information about their victims is accessible in the digital space. Perpetrators employ a wide range of tactics to deceive their victims in a booming, billion-dollar cybercrime economy. THE THREAT LANDSCAPE Let's categorize the methods used by cybercriminals based on the Swiss law-enforcement taxonomy. The fundamental distinction lies in whether one or more computers that are part of a network are the target of the criminals or whether cyber fraud is being committed. If the attack is directed at a single computer, two methods are employed: data is scouted, and if necessary, a system is modified or malicious software is installed. If deception is used without any system changes, it is referred to as phishing, which involves the theft of sensitive personal information in the digital space. Suppose criminals break into a single data processing system. In that case, they do so either by force or by exploiting someone else's access to data, which in both instances constitutes hacking to steal or alter personal data for criminal purposes. The use of malicious software can affect both individual and multiple computers. The term malware encompasses a range of software applications. Ransomware locks or encrypts IT systems to demand a ransom for the decryption key. E-banking trojans infect systems with code to take control of an account and initiate transactions. Spyware monitors user behavior and, once transmitted to criminals, is used for blackmail purposes. Rogueware/scareware is designed to scare users with a supposed virus infection and prompt them to purchase software that is, at best, useless and, at worst, another form of malware. If a network is compromised to gain control over it, the infected network is referred to as a botnet, controlled by cybercriminals. If, on the other hand, the objective is to overload a network, this is a case of DDoS (Distributed Denial of Services). Cyber fraud takes many forms, which are constantly evolving, as scammers continually seek to enrich themselves unlawfully by misleading individuals, causing them to harm themselves or others financially. In CEO/Business Email Compromise (BEC) fraud, cybercriminals pose as representatives of a company and induce individuals within the company or business partners to carry out a transaction. In advance fee fraud, an advance payment must be made to cover the costs of receiving an alleged sum of money. In false support requests, criminals use hacked communication accounts to send requests for financial assistance to contacts. In payment systems or identity theft, personal payment systems or stolen identities of others are used for fraudulent purposes. When a supposed technical support employee gains access to a victim's computer to fix a problem, supposedly, this is fraudulent technical support. The masterclass category includes online investment fraud, which comes in countless forms and induces victims to make investments that have no value or do not even exist. Fake real estate ads, fraudulent online shops, romance scams, and numerous other variations and subforms round out the spectrum. The industry is booming, and the entry barriers for criminals are becoming increasingly lower. Strategies, infrastructure, and illegally obtained data can be purchased on crime-as-a-service marketplaces. Today, an internet connection and off-the-shelf kits are sufficient to get started. As EUROPOL states in its 2025 Internet Organized Crime Threat Assessment, data is no longer just the target - it's a commodity. Cybercriminals don't need to be technically skilled, as all the required toolkits, tutorials, and data are readily available for sale in bulk. In our digital world, we generate vast amounts of sensitive data and expose ourselves to vulnerabilities that we are often unaware of. The more data available, the better fraud tactics can be applied. And perpetrators enter almost unnoticed through open digital gateways to gain their financial advantage. HIGH-NET-WORTH, HIGH EXPOSURE Criminals follow a simple principle: go where the money is. It's not that wealthy people are more clueless than the average person - they are just more affluent and potentially more lucrative for scammers than the usual victim. This, by the way, is the exact reason why older people are more targeted than younger people. Furthermore, substantial private wealth tends to be complex and thus more challenging to monitor, making the opportunity even more appealing to cybercriminals. In fact, data provided by the FBI's Internet Crime Complaint Center (IC3) shows that in 2024, the age group of 60 and above suffered the most significant losses, followed by those in their 50s and 40s. In 2024, in the USA, a total of losses due to cyber-enabled crime amounted to USD 16.6 billion, a 33% increase from the previous year. Cryptocurrency frauds account for USD 9.3 billion in losses, a 66% increase from the prior year. The three most profit-generating strategies are linked to cryptocurrency investments, personal data breaches, and fraudulent tech support. It's no surprise that family offices are also particularly targeted by cyber-criminals. According to Deloitte's 2024 Family Office Cybersecurity Report, 43% of family offices globally had experienced a cyberattack in the previous 12 - 24 months. The top three strategies were phishing, malware, and social engineering, and of those family offices affected by cybercrime, one-third suffered losses. There you have it: the current trends in the cybercrime industry target wealthy individuals and include digital assets. And let's bear in mind that the above numbers do not capture the entire damage since many victims do not report their cases. THE NEXT LEVEL Wondering what's the hottest development in cybercrime? It's, of course, AI. Deepfakes offer tremendous opportunities for cybercriminals. Synthetic video or audio files created by AI are of remarkable quality and available at a low cost. It no longer requires specialist skills to scale many of the above strategies. Let's take the CEO/BEC fraud as an example. In 2024, a British engineering company lost GBP 20 million after an employee fell victim to an AI-generated video call in which the avatar of a senior executive instructed them to transfer funds to the scammers' account. Today, public video and audio provide ample source material, and consumer tools can produce convincing real-time avatars. With a video of a human on a social platform, the source data for the avatar is readily available, allowing the scammer to operate as another person in real-time. The chief information officer of the affected company reported that they were accustomed to dealing with various types of cyber attacks, but couldn't keep pace with the sharp rise in the number and sophistication of attacks within a few months. He refers to what happened at his company as technology-enhanced social engineering, since it wasn't a pure cyberattack in the traditional sense. None of their systems were compromised, and no data was affected. Also in 2024, a large global advertising company was targeted with a similar modus operandi. Scammers leveraged YouTube videos in combination with WhatsApp and an MS Teams meeting to impersonate the CEO, using an AI-generated voice, to obtain money and personal information from a senior leader under the pretext of starting a new business. Although the attack was repelled, the CEO also reported an increase in the sophistication of cyberattacks. One might think that these threats only affect the corporate world. However, let's imagine a family office that regularly initiates transfers at the principal's instruction. As a security measure, transactions ordered by email are always confirmed by telephone. With a hacked email account, a redirected phone number, and an AI-generated voice of the principal, funds could be diverted to fraudsters with relatively little effort. As outlined above, nearly one in two family offices has experienced a cyberattack, and one-third of those affected have suffered financial losses. Or why not fake a kidnapping of a family member? With some background information about a family member's trip to a remote destination, sending an AI-generated voice video of the supposedly kidnapped, accompanied by a request to send money immediately, could create the necessary agitation and sense of urgency - two significant catalysts for successful fraud - that would induce the family to make a ransom payment. Criminals would reach their objective without having to do any physical work. Social engineering, a manipulation aimed at causing people to behave in a certain way to obtain access to systems or sensitive information, has been supercharged with the aid of AI. For instance, spear-phishing attacks are highly personalized, based on information scraped from social media profiles and other online sources, with the primary aim of gaining access to sensitive data. This used to require a substantial amount of preparatory work; large language models now enable criminals to run entire campaigns and scale their operations while still targeting individual victims. Research already shows that AI-generated messages are more likely to deceive victims than human-generated content. How Crypto Fuels Criminal Playbooks As cryptocurrencies gain wider acceptance and reach all-time highs, they have become a focal point for digital crime. Sam Bankman-Fried, for many a Bernie Madoff of the digital age, according to the US Securities and Exchange Commission, was orchestrating a massive, years-long fraud, diverting billions of customer funds from his FTX trading platform for his personal benefit. This caused losses of USD 8-10 billion. Like Madoff, Bankman-Fried, celebrated for his charitable donations and allegedly humble lifestyle, was capitalizing on the leap of faith of investors to use funds for his own purposes. The trick is not new; it has just gone digital. Scammers often trigger specific emotions in their victims, including the fear of missing out, a sense of urgency, and greed, among others. These feelings suppress scepticism and caution. While the crypto investment scam, in all its forms, remains an evergreen, other tactics target wealth owners more specifically. With a phishing email, scammers pose as a crypto exchange and warn their victims about suspicious activities on their account that may lead to it being closed. As soon as the link in the email is clicked and login details are shared, they get access to the account and transfer the deposits to their wallets. Now it's good advice not to keep cryptocurrencies with exchanges. However, even with a ledger device, fraudsters find ways to access their victims' cryptocurrencies. They simply pose as an exchange that can't execute a transfer to the victim's ledger due to technical issues and offer ledger recovery support. To this end, the seed recovery phrase is shared with them, and they control the wallet. Or they pose as a ledger producer, highlighting a security problem and offering a free replacement. Again, with a few clicks, they gain control over their victims' wallets. Another tactic is to offer new tokens that require a specific app to be connected to a wallet to receive them. There are thousands of cryptocurrencies, and with targeted social media campaigns, fraudsters create the narrative of the next big thing in crypto, offering a unique entry point at a discounted price for a short period. As soon as the app is downloaded and a fake smart contract is accepted to execute the transaction, a malware script empties the victim's wallet. Crypto assets have gained a foothold in private wealth management and among high-net-worth investors, who are increasing their allocation to the asset class. And cybercriminals target the affluent for a simple reason: they follow the money. They add a touch of exclusivity, fake testimonials from their victims' network, promise outstanding opportunities, and encourage quick decisions. With personalized tactics, cryptocurrencies are merely an enabler for quickly transferring value to their pocket. The Bottom Line Cybercrime's next level is here: scalable deception, AI deepfakes, and instant value transfer. Thus, cybersecurity has become a crucial foundation for wealth preservation. If institutional players are already struggling with keeping up with the scammer's pace, this is even more relevant for affluent individuals and their family offices. Research indicates that, despite the increase in cyberattacks, many family offices lack adequate preparation for these threats. Awareness is no longer enough to combat the sophistication of the cybercrime industry. Wealth owners and their family offices must implement comprehensive and robust cybersecurity plans to safeguard their wealth against an increasingly aggressive and expanding cybercrime menace. This includes identity protection, secure payment processes, deepfake resilience, enhanced account security, institutional-grade crypto custody, continuous training by professionals, and incident readiness. If you're wondering when to start, the answer is: now. Cybersecurity Checklists for Family Offices Practical Tools to Combat Next-Level Scams
When receiving video/audio communications requesting transfers or sensitive information:
Before executing any unusual transfer request: Red Flag Phrases to Watch For:
Monthly review for digital asset protection:
Ensure these elements are in place BEFORE an incident:
For principals and key family office staff:
Train all staff to recognize these tactics:
Monthly review of exposure points: IMPLEMENTATION NOTES Priority Order:
Success Metrics:
Remember: Security is not a product but a process. These checklists should be living documents, updated as threats evolve and lessons are learned. These checklists complement the article "Next-Level Scams: AI, Crypto and The Assault on Private Wealth" by Markus Schwingshackl, published in HORIZONS: Family Office & Investor Magazine, Issue 11, and should be reviewed quarterly and updated based on emerging threats. | ||||
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Horizons: Family Office & Investor Magazine
Next-Level Scams: AI, Crypto and The Assault on Private Wealth |
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