The new 'virtual' kidnapping craze

Hacking
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An unfortunate geopolitical reality is the rise of kidnappings, particularly in Southeast Asia, the Middle East and Africa. But today's criminals are getting even more sophisticated by exploiting technology and engaging in "virtual kidnapping."

Unlike traditional kidnappings, abductors do not wish to have any type of physical contact with their victims. Virtual kidnappers rely solely on deception, fear and their technological expertise to make families think that a loved one is in danger and a ransom must be paid immediately, through an electronic transaction or wire transfer, in order to gain their release.

This extortion scheme, though not new, has become big business in recent years, according to the FBI. But because so many incidents go unreported, the FBI told CNBC it's hard to know exactly how much money criminals make from virtual kidnapping schemes as well as the actual number of incidents that take place annually.

Perhaps the primary reason for this uptick is the fact that it is so easy to carry out: The only information a virtual kidnapper needs is a telephone number and some personal information about the victim—things that can easily be gleaned from social networking sites. And while the schemes vary, their motive is always: to ensure that the victim is in a place where they can't be contacted by the family and to get the ransom paid before family members and loved ones realize it's a scam.

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To accomplish this task, virtual kidnappers hack into a person's email and other accounts, then follow their preyeither physically or through social mediaand wait until they turn off their phones or are in a place where they would be unreachable, like at a loud concert or, more commonly, on a flight.

Appearing as though it is coming from the victim's phone, an email is sent to a family member claiming that their loved one has been kidnapped and a ransom needs to be paid in order to get them released. The virtual kidnappers then sit and wait, hoping a transaction will take place.

The rise of virtual kidnapping and holding data hostage
The rise of virtual kidnapping and holding data hostage   

According to KRMagazine, the problem is most prevalent in Latin America and is growing in Mexico.

Internet security expert Joseph Steinberg told CNBC that the criminals typically do not demand a big sum of money, instead preferring to get the payment right away and insisting that the person from whom the ransom is demanded stay on the phone with them for fear that if connection is established with the alleged victim, the scam will be exposed.

"It's very different from typical kidnapping where they don't want the line traced. Here, they want to stay on the line with you," Steinberg said.

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"They're leveraging the fact that if I can't reach my child for example and someone tells me my child is in danger, I'm likely to do whatever it takes quickly to make sure that my child is safe, and that carries on into various forms of scams."

Hostage insurance broker Michal Gnatek told CNBC that some insurance policies cover most types of extortion, including virtual kidnapping, but he is not aware of any stand-alone coverage for virtual kidnappings.

As far as how much money criminals made from this type of extortion, the Federal Bureau of Investigations (FBI) told CNBC that those statistics are not currently available for release.

The rise of ransomware

Another form of virtual kidnapping is holding one's data hostage.

By infecting a person's computer with ransomware, criminals are able to encrypt files until money is paid to the entity that is responsible for locking the device.

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According to a report issued by Intel Security Group's McAfee Labs, ransomware has experienced a 165 percent increase in the first quarter of 2015.

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Recent data from the FBI's Internet Crime Complaint Center (IC3) shows that CryptoWall was the most significant ransomware threat targeting U.S. individuals and businesses.

The report said that the financial impact to the victim, aside from the ransom itself, is anywhere from $200 to $10,000, as some choose to pay for legal fees, IT services or other help to try to resolve the issue and save their data.

"Between April 2014 and June 2015, the IC3 received 992 CryptoWall-related complaints, with victims reporting losses totaling over $18 million."