Guardians at the gate: Vulnerability and fraud in the digital delivery chain

Banking, cards, and online fraud are rapidly rising due to a combination of technological advancement, significant data exposure throughout the entire delivery chains, outsourcing practices, and the economic instability affecting both the workforce and digital environments. 

The fragmentation and sheer number of participants in online buying and delivery - from e-commerce sites to outsourced riders - have made personal data widely accessible and therefore vulnerable.

Why Online and Banking Fraud Is Rising

Rapid digitalisation, global economic uncertainty, and evolving criminal methods are main contributors to rising fraud in digital payments and banking. Attackers exploit weaknesses in mobile banking, online transactions, and ATM systems through tactics such as phishing, malware, social engineering, and even sophisticated AI-generated deceptions. As fraudsters become more advanced, even systems designed for consumer protection can be targeted and bypassed.

How Many People Access Customer Data

In today's e-commerce and services ecosystems, massive data flows are integral to operations - from website managers to third-party logistics and local delivery riders. Each step involves access to names, mobile numbers, and addresses. Outsourced riders, property brokers, outsourced bank and other customer services, and intermediary agents often handle sensitive information without strict supervision, creating risk points where data can be illicitly sold to augment income. Service agents in banks also routinely access full customer profiles for legitimate business processes, but sometimes with inadequate internal controls, creating vulnerability for misuse or internal fraud.

Information Sharing and Data Selling

Many property brokers and agents exchange customer lists, sharing home addresses and contact numbers to close deals or improve service efficiency. In supply chains, information about buyers is passed down to delivery agencies and riders. The economic pressure on frontline workers - especially gig and delivery staff - means that some resort to selling personal data for a small fee, fueling a black market for sensitive information.

Courier and delivery agents hold direct access to personally identifiable information through package labels - names, home addresses, and mobile numbers - that can be misused or traded. For example, some delivery agents might exploit this access by selling customer information to local fraud rings or telemarketers who use it for unsolicited selling or scams. There have been cases where fraudulent agents impersonated legitimate couriers, contacting recipients with fake delivery failure notices to extract payment for “redelivery fees” or customs taxes. These scams often involve coercing customers into sharing sensitive payment details over calls or links, exploiting trust in the delivery process.

Courier companies or their agents could potentially open packages containing new ATM or credit cards, steal information, and reseal the packages to appear original. This risk exists because the physical handling of sensitive shipments like bank cards or cheque books requires access to the package, and unscrupulous insiders could exploit this access. There have been reported cases where fraudsters within courier or logistics companies tampered with packages to either steal cards or skim information to facilitate later fraudulent transactions.

How Authorities Can Create Stringent Systems

Regulatory bodies across major markets recognize these risks and are tightening controls through comprehensive data protection laws and cybersecurity standards. Global frameworks like GDPR (Europe), CCPA (California), and PIPL (China) mandate limited data collection, strict disclosure of data handling practices, and penalties for breaches or unlawful transfers. Key regulatory strategies include:

• Data minimisation: Only necessary data for transaction completion to be collected.
• Mandatory encryption: All sensitive data, including within supply chains, should be protected with strong encryption protocols.
• Controlled access: Real-time monitoring, access controls, and "Zero Trust" architecture to restrict who can see data.
• Third-party compliance: Vendors and partners must meet the same cybersecurity standards as core organisations.
• Breach notification: Prompt disclosure to affected individuals for swift mitigation of harm.

Protecting Customer Data in Practice

Leading organisations are adopting multi-layered security, combining AI-driven fraud detection, strict employee permissions, encrypted communication, and continual staff training. Anti-fraud technologies monitor transactions for anomalies, preventing push payments and unauthorised data transfers in real-time. Supply chain actors increasingly use standardized contracts and compliance audits to ensure no weak links in data protection.

The Future and Associated Risks

Technological progress comes with disruption, as automation and AI reduce jobs, sometimes leaving displaced workers with access to valuable data and motive for misusing it. The continual advancement in fraud techniques, including AI-powered forgeries, will challenge systems—and only constant vigilance, regulatory updating, and ethical business practices can counter this.

While risks increase, industry and regulators are collaborating to defend consumer privacy and uphold integrity - even as delivery chains become more complex and connected. Investment in robust cybersecurity, vigilance at every step of the value chain, and stringent enforcement of data privacy laws can create a safer digital world. 

In the online world, security cannot be considered as a product, but a stringently designed process frequently re-tweaked.

{Views are personal; the author is a certified board director (MCA India), board member, ESG director, digital director, member of UAE Superbrands Council, and HBR Advisory Council}