Karsten Wenzlaff, Advisor
August 26th, 2025
Karsten Wenzlaff is a Crowdfunding and Fintech Expert from Germany. He is Secretary-General of Digit[...]
Category Archives: Cyber Security, Quantum, Hacks, Fraud Alerts, Risks, InsurTech
Prompt Injection Attacks in Slack’s AI Integration
AI Risks | Aug 22, 2024
Image: Freepik/rawpixel.com
Bad actors can access private channel slack data using prompt injection attacks
Security experts, PromptArmor, found a serious flaw in Slack's AI integration in August 2024 that may allow private channel communications to be exposed using a sophisticated method called prompt injection. By including a certain set of written instructions in public channels, bad actors can control Slack's AI and potentially cause private channel data breaches without having access. Companies and individuals should be careful of the private data they share on these platforms.
Prompt Injection Exploit
PromptArmor discovered that Slack's AI can access both public and private channels, and be tricked into sharing private conversations containing sensitive information. The attacker doesn't even need to be present in the channel that is being targeted. All they have to do is insert malicious instructions into public channels that the AI can access, and the AI will be tricked into sharing private information like API keys.
See: Meta Agrees to Pay $14B to Texas for Data Privacy Settlement
By extending AI's search capabilities to files and direct messages on August 14, 2024, Slack unintentionally raised the risk of quick injection attacks. These days, malicious code that starts the exploit can also be found in documents like PDFs.
PromptArmor believes:
"If a user downloads a PDF that has one of these malicious instructions (e.g. hidden in white text) and subsequently uploads it to Slack, the same downstream effects of the attack chain can be achieved."
Corporate Data at Risk
In 2020, Slack had over 12 million active daily users, where most of them use the platform for essential business communication. Sensitive information, such as financial information, proprietary data, and private chats, could be exposed due to this vulnerability. With such extensive adoption, this data breach risk is highly concerning.
Slack's Response
Slack quickly released a patch on August 20, 2024 in attempt to fix the attack saying that enabling AI's search capacity across open channels was deliberate (trying to downplay the seriousness of the vulnerability. However, even with the patch in place, questions remain on how well Slack's AI governance can protect user data.
See: Feds Warn Companies to Not Delete Slack Chats
Akhil Mittal, Senior security consulting manager at Synopsys said:
"This vulnerability reveals gaps in AI’s security framework that need urgent addressing, especially as more businesses adopt these tools to manage critical data".
Outlook
Although Slack has fixed the immediate issue, companies still need to be on the lookout and advocate for strong AI security measures. To stop future attacks, regular audits, AI access controls, and employee data security training are essential. 'User beware'
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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Car Modifications: How Does it Impact Your Insurance Policy?
Aug 22, 2024
Image: Freepik/rawpixel.com
Thinking about modifying your car but worried about higher insurance costs? The good news is that not all modifications will increase your premium, and some might even reduce it. However, it’s crucial to be cautious with your spending on enhancements that affect your car’s appearance, performance, or functionality.
Before diving into any modifications, it's essential to understand how these changes can impact your insurance policy. Be aware of the expenses covered by your policy and consider whether additional coverage is needed. If you're considering spending more on your car modifications, it's important to ensure you have the right coverage. Make sure to buy car insurance online in Canada to protect your investment. Check out the guide to learn about various vehicle modifications and how they could affect your insurance policy, helping you make informed decisions.
Types of Car Transformations with Their Impact on Coverage Policy
- Performance Improvements: Many car owners install high-performing exhaust systems, engines, turbochargers, etc., to improve their vehicle's overall performance and power. These customizations are quite visible to assurance companies, and they may charge higher premiums. The cost of repairs is high in the case of accidents. To cover all such risks, you must pay your insurer more to secure your vehicle.
- Safety Enhancements: Adding more safety features to your vehicle, like parking sensors, security cameras, high-end braking systems, etc., can decrease the premium amount. These changes ensure that the vehicle drives safely on the road and is less likely to be stolen. You will also get additional discounts on your insurance policy if you add such enhancements.
- Cosmetic Modifications: If you prefer to customize the vehicle's appearance by changing the paint, alloy wheels, etc., it can still affect the coverage cost. The cosmetic changes will enhance the car's value, elevating the insurance cost.
Impact of Modifications on Coverage and Claims
Insurance companies have different terms regarding the coverage and claim process for various modification options.
- Coverage Limits: Some insurance policies limit the amount that will cover modified auto parts. Before buying any policy, make sure you check the coverage limits and ask to exceed the existing limit. When you feel satisfied, go ahead and buy the plan.
- Claiming Process: If your vehicle is modified, the claiming process becomes quite challenging during the accident case. A car owner has to provide all the details regarding the added enhancements. These alterations will change the value of the automobile and, hence, affect the claiming process.
Reasons to Notify the Assurer About the Enhancements
If you have already modified your vehicle, there is no need to hide anything from your insurer. There is a risk of severe consequences if you do not report the changes. The following are the reasons to keep transparency with the insurer:
- Claim Denial: At the time of the accident, your claim can be denied in case you have not disclosed the customizations. You will be forced to pay more than pocket allows for the damages to the third party. If you have already cleared the details of vehicle enhancements, the claims will easily settle down within your policy.
- Policy Voidance: An insurer has the authority to void your policy if he is unaware of the alterations in your vehicle. When he gets to know about the alterations suddenly, the car owner will not get the coverage. There is no use in paying a low premium amount when you cannot attain the coverage you require the most.
Legal Considerations and Insurance Requirements for Modifications
If you are fascinated by transforming a vehicle's aesthetics and performance, it is better to check the legal requirements in your area. For illegal changes, you may need approvals. If you do not follow the regulations, you have to pay the penalty.
In the worst cases, your assurance policy will be invalidated. Therefore, it is important to know whether car transformation is legally accepted in your place and whether you can also get insurance coverage for your vehicle.
Tips to Get Insurance for Modified Car
- Compare and Buy the Best Coverage: You can find insurers everywhere selling policies to car owners with enhancements. Talk to different insurance companies to compare their policies and acquire the one with the best coverage at an affordable price.
- Keep the Documents Ready: After customizing your car, keep all the records with you. These documents can be attached to the policy to remind the insurer about the enhancements and seamlessly proceed with the claiming process.
- Expert insurers: Meet insurers who are experts in understanding and calculating coverage for transformed cars. They can understand the needs of the car owners and provide a customized policy option to benefit them at an affordable price.
Final Thoughts
By transforming your automobile, you can alter the overall appearance and functioning of your vehicle. But it can impact the price of the assurance coverage.
See: Walnut Insurance Raises $4.6M for Embedded Tech Expansion
It is important to share each enhancement detail with your insurer to get the customized policy option within your budget. If you own the right policy, you can get a claim when required seamlessly.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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FINTRAC Working to Fully Restore AML System Post-Cyberattack
AML/ATF | Aug 13, 2024
Image: Pixabay/cliff1126
FINTRACs Cyberattack Exposes Vulnerabilities in Canada’s Anti-Money Laundering Efforts
With critical systems remaining down for several months after FINTRACs March 2, 2024 cyberattack, the incident is said to have exposed gaps in Canada’s anti-money laundering (AML) infrastructure sparking concerns about national security. Specifically, the inability to detect financial flows that support criminal organizations and terrorist networks, potentially weakening the country’s standing in international efforts to combat financial crimes and collaborate with global intelligence partners.
See: Blakes: Cybersecurity Trends in Canada: A 2023 Perspective
Key Insights
- On March 2, 2024, FINTRAC discovered a cybersecurity incident that resulted in the immediate shutdown of core platforms including its web reporting system for gathering suspicious transaction reports (STRs). To put this important system in perspective, last year approx. 36 million financial transaction reports were submitted (either suspicious or over $10k) by a wide range of reporting businesses, including banks, casinos, and real estate firms. A report by Criminal Intelligence Service Canada estimates that between $45-113 billion is laundered across Canada annually.
- Although the cyberattack adversely impacted FINTRAC's web reporting system for more than five months, workarounds were used in its place to lesson the impact:
- Companies were advised to use Canada Post's ePost system to prioritize their suspicious activity reports (SARs) and file the most urgent ones first. Following the complete restoration of the online platform, non-priority reports were required to be retained and filed.
- In April 2024, FINTRAC introduced a new API system for businesses that manage large amounts of STRs (representing 96% of the yearly reporting). Major banks and other large financial organizations could continue filing their reports electronically thanks to this technology.
- However, according to some AML experts, FINTRAC may be losing out on thousands of reports of suspicious transactions. Kim Manchester, the creator of ManchesterCF, a financial intelligence training company, stated, "Our allies are paying attention to Canada's financial intelligence capabilities, which seem to be falling apart.", posing a threat to national security.
See: SEC vs. Canada: Cybersecurity Rules Overview
- FINTRAC hasn't provided a firm date for when all systems will be fully functioning, despite efforts to minimize the hack and restore systems. It is anticipated that there would be a sizable backlog of incomplete reports, and removing this backlog will be a difficult task. As Dwayne King, a compliance officer at WFCU Credit Union for anti-money laundering was quoted in the Globe and Mail, "FINTRAC needs to provide some solid guidance on what is expected of you in order to clear the backlog in your organization."
Outlook
This cyberattack is a wake-up call of the need to invest in stronger cyber defences with robust back-up systems in place for organizations monitoring national security issues. International community is looking for a dependable partner in the global battle against financial crime.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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BC Crypto Trading Platform Defrauds Customers of $13M
Enforcement | Aug 12, 2024
Image: Freepik/rawpixel.com
ezBtc defrauds traders of $13 million through bogus claims of cold storage
Today, the British Columbia Securities Commission (BCSC) announced that BC-based crypto trading platform, ezBTC, has scammed clients out of $13 million by pretending to hold their assets in cold storage. David Smillie, the platform's operator, instead transferred user funds to his own accounts and online casinos. Crypto is still full of hazards and there's a pressing need for more consumer protection. Read the statement.
False claims were made by ezBtc that it would securely store client funds in cold storage. In reality, more than 935 bitcoin and 159 ether, worth around $13 million, were taken to Smillie's personal accounts and internet casinos. Customers experienced severe financial and psychological distress as a result of being unable to withdraw their money.
The BCSC came to the conclusion that Smillie and ezBtc had committed securities fraud in violation of Section 57(b) of the Securities Act. The Commission underlined that in order to prevent future instances of this kind of fraud, stronger sanctions and more widespread enforcement are required.
See: All Crypto Exchanges to Register as Investment Dealers
The findings of the BCSC highlight the deficiencies in the existing regulatory framework. It took many years, from 2016 to 2019, for customers to start complaining about the fraudulent activity.
Smillie's actions damaged investor confidence in digital asset platforms in addition to misleading investors. The CSA hosts a list of regulated platforms that are registered and allowed to do business with Canadians.
Conclusion
As digital assets become increasingly popular, there's a pressing need for strong regulatory frameworks and improved consumer protection measures. Establishing accountability and stronger oversight is critical to fostering confidence and protecting the interests of all stakeholders in the crypto ecosystem.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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Inscora Secures $2M to Revolutionize Cyber Insurance
Funding | Release | Aug 6, 2024
Inscora's Founders (Image provided by Luge Capital)
Montreal Fintech Inscora Announces $2M in Funding Led by Luge Capital
Montreal, QC – Aug 6, 2024 – Inscora, a Montreal-based fintech that provides automated cyber risk assessment and sales enablement tools to cyber insurance brokers, has secured $2 million in funding. The financing round was led by Luge Capital and also included Desjardins Capital, Accelia Capital, Inovia Capital, and cybersecurity angel investors.
Highlights
Inscora was co-founded by:
- Gabriel Tremblay, a repeat cybersecurity entrepreneur who previously co-founded Delve Labs (acquired by Secureworks);
- Pierre-David Oriol, former VP of Product at Delve Labs; and
- Guillaume Raymond, former Director of Engineering at digital health company Dialogue (acquired by Sunlife).
See: Blakes: Cybersecurity Trends in Canada: A 2023 Perspective
Inscora's platform empowers insurance brokers with a innovative cyber brokerage approach that increases customer value, calculates better risk-adjusted premiums, and leads to higher sales conversions. The company is already collaborating with a select group of insurance industry players as part of an early trial program. Core benefits and platform capabilities include:
- Accurately and effortlessly assess a company's cyber risk profile
- Assist customers in incorporating the latest cybersecurity best practices
- Drastically speed up the cyber insurance application process
The use of proceeds will fund team expansion, continuous platform improvements, and product launch in both Canada and the U.S.
Gabriel Tremblay, CEO and Co-Founder of Inscora:
"We have spent our careers developing products that help organizations protect themselves against cyber attacks. Inscora represents a unique opportunity to apply this expertise to the ever-evolving field of cyber insurance and improve the efficiency of insurance brokers as well as the security posture of the insured clients. We are thrilled to have the support of such esteemed investors to help us now go to market."
See: Luge Capital Secures $71M in Second Fund’s First Close
David Nault, General Partner at Luge Capital:
"We have seen, first hand, how complex purchasing cyber insurance can be and the lack of tools available to the insurance industry to guide clients to implement stronger security measures within their organizations. Inscora is solving both of these important issues to support the ever-evolving cyber insurance industry."
Contact Information
For more details, please contact:
Gabriel Tremblay
CEO Inscora inc.
Email: contact-media@inscora.com
Website: https://inscora.com
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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Risk Management Strategies for Investors: Protecting Your Portfolio
Jul 26, 2024
Image: Freepik/azerbaijan stockers
Effective risk management is essential for investors to preserve capital and minimize the volatility of their portfolios. Below, we outline the primary risk management strategies:
Correlation Analysis
Closely related to diversification is correlation analysis. Diversifying by simply increasing the number of assets in a portfolio may not have the desired effect of reducing overall volatility if the assets are highly correlated - typically investors should look for assets with less than .50 correlation to their overall portfolio.
When calculating correlation it is important to use a longer history (at least one year of data) as short-term correlations can be very unstable. For this purpose it is important to select a data vendor which offers a data history over five years such as FirstRate Data.
Position Sizing
Position sizing involves limiting the amount of capital risked on any single trade. A common rule of thumb is to risk no more than 1-2% of your total trading capital on a single position.
An important point to note regarding portfolio sizing is that the positions need to be constantly rebalanced. A position which is initially 2% of a portfolio could expand to over 10% if the stock appreciates, thus position sizing requires investors to be constantly selling their most profitable positions
Stop-Loss Orders
Stop-loss orders automatically close a position when the price reaches a predetermined level, limiting potential losses. This imposes a discipline on investors to cut losing positions and avoid extending losses.
Diversification
Diversification involves spreading investments across different sectors, asset classes, or geographic regions to reduce overall portfolio risk. Diversification typically also improves the overall portfolio performance over the long run (ie timeframes over two years).
ETFs can be a useful tool in diversification as they offer a low-cost method for purchasing a basket of stocks.
Hedging
Hedging involves taking an offsetting position to reduce the risk of adverse price movements in an asset. There are two types of hedges - direct and proxy hedges. A direct hedge involves taking an offsetting position in a directly related asset - such as hedging a position in AAPL stock with a put option on AAPL which will pay off if the stock declines.
See: The Future of Forex Trading in the FinTech Era – Innovations and Implications
As most investors will have numerous assets in their portfolios, it is often more efficient to use a proxy hedge which correlates with a basket of assets. For example, an SPX put option will often be used to hedge a broad portfolio of US large-cap stocks.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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Changes to PCMLTFA Pre-Published for 30 Day Consultation
Regulation | Jul 8, 2024
Image: Freepik/sentavio
New Regulations under PCMLTFA Announced with 30 Day Public Consultation Open
New rules under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTFA) have been pre-published by the Canadian government. The proposed revisions, which are accessible now in Part 1, Volume 158, Number 27 of the Canada Gazette, seek to put into effect a number of initiatives that have been recommended in recent economic statements and budgets.
See: FINTRAC Guidance on Bitcoin ATMs and Money Laundering
To read the complete text and more information, go to both of the links below:
Overview of Proposed Regulatory Changes
Stakeholders have a 30-day consultation period to provide feedback on these proposed changes.
- Requires properties owned or controlled by individuals or entities listed under various anti-terrorism and sanction statutes to submit detailed reports on sanctioned properties.
- Introduces more stringent reporting guidelines and a registration structure for money service companies operating in the MSB sector in an effort to stop the financing of terrorism and money laundering.
- Requires thorough documentation of the private white-label automated banking machines' ownership, operation, and funding sources in order to improve security and transparency.
- Mandates title insurers to keep extensive records on title insurance policies and enforces the identification of unrepresented and third parties in real estate transactions.
See: Elliptic Publishes New Research on AI and Money Laundering
- Closes a regulatory loophole by making casinos disclose the ultimate beneficiary of payments received from third parties to ensure money traceability.
30 Day Consultation Period
Stakeholders are invited to evaluate the draft regulations and provide feedback during a 30 day consultation period. The contact information for submitting comments on the proposed regulations can be found in the Canada Gazette notice. Final regulations are expected later in 2024. Feedback can be sent by regular mail, email, or the internet.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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