Due to the unfortunate story of University of Notre Dame football star Manti Te'o's "fake" girlfriend in late 2012, much of America is now familiar with the phrase "catfishing." This practice refers to a situation where a person, through false social media identities, pretends to be someone he or she is not. However, celebrities are not the only victims of such deception. While the Te'o case was not a particularly sophisticated digital "scam," it demonstrates the potential for unscrupulous persons to use technology even in a simple way to take advantage of trusting victims.

Victims of digital scams can also include companies that are taken advantage of by their own employees and business associates seeking to steal from the company. Such activities can include embezzlement and intellectual property theft, with some of those cases involving unfaithful employees stealing from companies (and even secretly working for competitors) for years.

Digital scams can also create problems in the litigation context, because not everything is always as it seems. For example, while the Te'o catfishing case was relatively low-tech, we have seen increasingly sophisticated scams involving scores of fake documents, including email that appears to be real. One high-profile dispute between a company's founder and a person who claimed the founder gave him part ownership of the company involved numerous emails that appeared to be between the founder and the person, but the founder and his company claimed the emails were fakes.

Depending upon how a company's email system is set up, it can be entirely possible for a person with the right knowledge, tools, and system access to modify or even create "emails" on a company's server that appear real, right down to the metadata. Careful forensic analysis may find signs that the emails were faked or spoofed, but this is not always possible — particularly where sophisticated actors are involved.

Finally, one of a technology company's biggest fears is getting "hacked" and having the security of its customers' personal information compromised. Such cases are often sensationalized and can lead to a breakdown in consumer trust. In 2012, two of the largest incidents involved an online retailer, where 24 million consumer accounts were compromised, and a social media company, where six million passwords were breached. Such cases can lead to consumer class action litigation, but most of the cases are resolved quickly due to the inability of the plaintiffs to show any actual damages (emotional distress is insufficient). However, compromises in security can lead to successful consumer claims as well as losses of sensitive company information and trade secrets. This is a particular risk as more and more employees are using their own mobile devices — which are more easily lost or stolen — to conduct company business.

Strong internal policies, the use of encryption, and vigorous legal enforcement following security breaches are a company's best tools for combating and responding to security breaches and other digital "scams."

Copyright 2013. Morgan, Lewis & Bockius LLP. All Rights Reserved.

This article is provided as a general informational service and it should not be construed as imparting legal advice on any specific matter.