How to Help HNW Clients Evade Kidnapping, Ransom and Extortion

It is hard to imagine a greater financial or personal peril for individuals and their families than kidnap, ransom and extortion crimes. Merely imagining its occurrence is enough to induce spine-tingling shivers and gut-wrenching queasiness.

Fortunately, many affluent families are well advised of these exposures by their financial advisors and insurance brokers, the latter a vital conduit to the many important services provided by specialized insurance companies bearing the kidnap, ransom and extortion risk.

For the most part, affluent families are well aware of the kidnapping “hot spots” around the world, such as Mexico, Venezuela, the Philippines and the Sahel region of Africa, among others. Many take adequate precautions when visiting such places for business or vacation. But just like hackers are always one step ahead of the latest cyber crime prevention tactic, kidnappers are always devising ingenious new ways to abduct wealthy individuals and their children for large ransoms.

Brad Hedberg, president of the Portico Group, a Chicago-based insurance brokerage specializing in the risk management and insurance needs of affluent families, financial institutions and not-for-profit organizations, recently described to me an incident last year involving the daughter of a billionaire that could have ended badly. “She’s a young teenager, and like all people that age has feelings of invincibility, which can lead to imprudent behavior,” he explained. “She had tweeted some details about her family, such as the time and place of her graduation dinner. She also tweeted a photo of herself and her brother on the family jet as they traveled to a specific location for a family vacation. Inadvertently, she had exposed herself and the rest of the family to a kidnap risk.”

Had the family’s security team not detected the tweets and shut down the girl’s account, the children could have been abducted and held captive for untold millions of dollars in ransom. Even worse, they could have been physically harmed.

Money Matters

As this story indicates, technology has become the newest weapon in the arsenal of organized crime, the primary perpetrators of kidnap, ransom and extortion schemes. If a criminal realizes that an affluent person will be at a particular location at a certain time, this information can be the means to a disastrous end.

Few people are aware that social media sites like YouTube, Facebook and Twitter use so-called “geotagging” technology, which incorporates geographical location data like longitude and latitude into the user’s texts, posts and photos. It’s right there, often without the user knowing it.

Another way to determine a technology user’s location is through triangulation, an important navigation principle in ancient times. If a traveler knows the distance to three specific locations, then there is only one place he or she can be. In a modern world context, a smartphone can discern and disclose a person’s whereabouts by knowing the location of the nearest mobile phone towers and Wi-Fi hotspots.

Even the cards that serve as hotel room keys create identity risks. “Those cards contain your profile, which includes all sorts of personal data like your name and address,” Brad said. “Always take them with you and dispose of them when you get home. Otherwise, a criminal can find it, swipe it and realize exactly who you are and just how wealthy you may be.”