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Press Release

As Web Scraping Is on the Rise, Residential IP Providers Come into Question: Experts Advise on How to Avoid Large Scale Fraud and Use Scraping Legitimately

Large corporations and tech-savvy SMEs are utilizing IP address hopping to boost their website performance and gain a competitive advantage in the market. While the technology helps genuine companies advance their businesses, it could be simultaneously enabling new forms of large-scale internet abuse. CEO at a residential IP provider IPRoyal comments on how to avoid fraudsters and use web scraping legitimately.

With most physical businesses closing down due to COVID-19 and online traffic rising, retailers have been looking for ways to successfully move their operations online. While web scraping and its applications have helped many genuine companies thrive, it has also become an essential tool for new forms of malicious activity on the net.

As of 2021, around 23% of all internet traffic is created by web-scraping bots that are gathering data, running social media campaigns, and testing app performance for genuine companies. Recently, with the onset of the pandemic, these practices have become common among large corporations and SMEs alike.

However, at the same time, malicious actors have started utilizing web cramping technology as a tool to carry out various forms of internet scams. In fact, malicious bots that are carrying out DDoS attacks, scraping personal information, and are scanning for security loopholes on the web account for approximately 29% of all internet traffic.

“Prior to committing account takeover, new account fraud, or similar crimes, fraudsters have to obtain large datasets of personal user information—such as names, emails, and dates of birth—the type of data that can be aggregated using web scraping,” said Karolis Toleikis, CEO at IPRoyal.  “Since proxy providers give access to this technology, there is always a risk that these companies unsuspectingly become a one-stop-shop for scammers.”

Despite the possibility of enabling very serious crimes like property theft, extortion, and the disruption of government institutions, residential proxy providers have to contend with the risk of having their reputation destroyed. Therefore, according to Mr. Toleikis, they are motivated to invest in security systems that prevent such incidents.

“Residential proxy providers should always make sure that they are working with genuine companies and individuals only. Therefore, using an advanced user identity verification process is essential. This way, if the proxy provider suspects that their client has plans to engage in something unlawful–such as targeted phishing attacks, spamming campaigns, or online fraud—they can be immediately held accountable for their actions. We hope that this becomes a common practice in the industry,” said Mr. Toleikis.

While some residential proxy providers might be preventing a part of large-scale hacker attacks and fraud, malicious actors have a tendency to find other ways to carry out these internet crimes.

“All internet users should have a general awareness of the ongoing internet crime trends. However, not everybody has the time or technical background to understand the more intricate hacker schemes and how to avoid them. Therefore, companies should consider hiring an online security officer while individuals should invest in a reliable password manager and anti-malware software,” said Mr. Toleikis.

As anti-scam measures become more sophisticated, fraudulent activity is expected to take on new forms. Since there are no permanent solutions in this area, it is necessary that internet infrastructure providers stay flexible, responsive, and up-to-date about the most novel types of internet abuse.