Enterprise Fraud Management Archives - Infosecurity Outlook

Workato Enterprise Key Management to Guard Data

Posted on April 29, 2022 by admin

Workato Enterprise Key Management feature provides customers in highly regulated industries with control, compliance, and flexibility over their encryption keys and data within the Workato platform. Workato launched the Enterprise Integration Platform as a Service (eiPaaS) vendor that allows customers to bring their own keys to encrypt data, adding an extra layer of assurance and protection. It is critical to meet the demand for enterprise-scale capabilities that provide an even higher level of security. For security-conscious or regulated organizations that require full control and visibility over the data stored in their enterprise automation platform.

Manoj Parakkal, Salesforce Center of Excellence Lead and Senior Architect at MGM stated, “Workato EKM allows organizations like ours in highly regulated industries to take a more customized approach to how we encrypt data & logic in Workato by using our own keys. This is a critical requirement of any software we use at scale and we’re happy to see Workato’s leadership as the only integration or automation vendor offering support for EKM.”

Workato has taken the required steps to make data more secure for all customers by deploying new encryption algorithms. Workato EKM gives businesses control over their data. Customers can use their own encryption keys, which are stored in services such as Amazon Web Services (AWS) Key Management Service (AWS KMS). This adds an extra layer of security, allowing privacy-conscious organizations to safely move data between applications and complete automated workflows with Workato. Workato access is extremely granular. Security teams have complete control over each Workato user’s level of data access.

Girish Pai, Global Head of Intelligent Automation Practice at Cognizant said, “One of the reasons we partner with Workato is that they take great care to secure the data both in the Workato platform and across the thousands of applications customers integrate and automate with. The announcement of Workato EKM continues that commitment to security by allowing highly regulated institutions an even deeper level of customization and control over their data.”

Jayesh Shah, Senior Vice President, Global Solutions Consulting and Operations at Workato commented, “We are excited to bring Workato EKM to our customers as data security will only continue to grow in importance for organizations of all sizes. I hear about the impact that wall-to-wall enterprise automation makes on our customers every day, and I’m thrilled to see more and more highly regulated industries begin to take advantage of automation.”

Read more article:

Insider Threat Management

McAfee Offers Personal Data Cleanup

Enterprise Fraud Management – An Overview

Posted on May 19, 2021 by admin

Enterprise Fraud Management (EFM) is a centralized framework for risk management, providing comprehensive risk analysis and application of controls for identifying internal and external frauds across all users, accounts, and channels in the organizations by transaction monitoring and customer profiling. Furthermore, it helps in identifying malicious behaviour and corruption in real-time thereby combating risks, minimizing losses, ensuring regulatory compliance, and optimizing operational efficiencies across the organization and entities.
EFM platform gives higher visibility in identifying threats and mitigating these threats. EFM solutions also offer a unified dashboard, enabling real-time monitoring of transactions and raising alerts for anomalies if required.

Some Noteworthy Features of EFMs are –

Centralized Data Repository – Businesses are developing centralized data repositories for clients’ accounts and transactions data for various products and services across multiple channels. EFM solutions process large quantities of data in real-time to create detailed profiles of clients and employees using high-performance computing technology based on machine learning, which can be used to detect and investigate money laundering and fraud.

Fraud Risk Assessment – A fraud risk assessment is a vigorous and continuously improving process. Organizations do thorough fraud risk assessments to identify individual fraud schemes and risks, assess their probability and magnitude, check existing fraud control actions. They introduce new rules and regulations to improve fraud detection. EFM solutions use risk scores to assess fraud based on guidelines provided by enterprise firm and analysed historical information. The new cloud-based EFM solutions are flexible enough to adapt these new rules and risk assessment tasks.

Real-Time Detection using Analytics – Since fraudsters are becoming more advanced, EFMs must evolve at a faster rate. EFM solutions allow for in-depth analysis of internal and external data collected from all resources for real-time fraud detection. In addition to rule-based fraud detection, sophisticated predictive fraud models fuelled by analytics on massive quantities of data are being developed. Risk is assessed in real-time for each transaction using a combination of parameters, algorithms, and cumulative statistics by comparing the characteristics of each customer’s or employee’s conduct with the fraud models and recorded patterns of behaviour. Techniques like graph visualization are used to identify underlying patterns and irregularities in data. EFM’s have forensic tools for e-fraud investigation. The aim is to use all available data to detect illegal activity before it happens and to avoid it before a customer’s account is compromised.

Scalability and Performance – EFM solutions are cloud-based, so there are no data storage and processing limitations. Financial institutions like banks with millions of customers and billions of transactions can be monitored with EFMs while retaining the fast detection needed in real-time environments. These organizations can leverage EFM’s cross-channel fraud management, user-centric fraud detection based on advanced AI. EFM solutions can easily correlate fraud events across the organization.

Enterprise Case Management – Enterprise Case Management uncovers hidden relationships in financial transactions. It is created primarily for financial fraud detection and investigations in the EFM solutions, it is built on previous fraud cases. These prebuilt and streamlined cases include key areas of fraud, which ease the process of fraud detection.

In the digital era, with evolving technologies, fraud attacks are also increasing at an alarming rate, indicating organizations to include Enterprise Fraud Management solutions to mitigate threats and frauds in the risk landscape.

How can Banks Combat & Mitigate the COVID-19 Fraud Attacks

Posted on April 14, 2020 by admin

Coronavirus is continuing to impact several lives of people and the economy worldwide; fraudsters are busily engaged in phishing and scamming mayhem. Both coronavirus and coronavirus scams can affect your health and finance. While the world is trying to deal with the threat of COVID19, cyber-criminals are coming with innovative ways to perform sophisticated frauds based on the continuing COVID – 19. Across the globe, people are working remotely with limited security features as opposed to working in the office. Everyone is in quarantine and following the social distance protocol. Owing to which everyone is shopping online for their daily needs. It is quite evident now customer shopping behaviors worldwide have changed and will persist in doing so in the times ahead. Doubtlessly, cybercriminals will keep following the trends of consumers and adapt their plans appropriately.

In most companies, fraud is identified post it happens; it’s imperative for financial organizations with the rise in technology, fraud detection, and mitigation takes place in real-time. They should adopt a real-time fraud management solution that can be tailored in accordance with their requirements. As online shopping continues to grow, even the security of online channels should become stronger and more advanced. Detecting frauds at a very early stage at the same time optimizing the customer experience should be the motto for banks. Various enterprises are plunging into a multifaceted method to combat and alleviate frauds. Acting recklessly with a haste plan can cause more damage than any good in the current COVID-19 situation.

Several types of fraud are hitting both the merchants and the consumers in these difficult times. Banks should conduct further authentication steps to access data, also adapt the limit for any fraud ranking models, enabling more false positives which support in preventing frauds. Banks or financial organizations should comply with regulatory compliance to alleviate risks. With a swift system in place, banks can be agile and smoothly alter algorithms or update models to safeguard their customers’ security.

Presently frauds are majorly attacking Business Email Compromise (BEC), Phishing, Gift Card Fraud, fake and fraudulent sites, eCommerce Fraud, Account Fraud, and such others. As It is easier to get distracted at home or be under different stress; hence such an audience becomes a soft target, and most people are falling prey to such fraudulent activities

COVID-19 phishing attacks – It started to rise in January 2020 and by the end of March 2020 it had a sudden surge. Most of the phishing attacks comprised of brand spoofing, scams, fraud emails, and business email compromise (BEC).

Disclaimer: Actual Numbers in the graph may vary as these are approximate figures.

Preventive measures to avoid frauds

Incorporate ML and AI-powered fraud detection solution

With the support of ML and AI, the fraud solution can consolidate data from all internal and external channels and analyze historical data, enabling the risk model to detect anomalies and abnormal behavioral patterns. Hence one of the best practices recommended is to integrate fraud management software coupled with intelligent automation, and advanced AI and ML.

Secondly, some fraud solution experts use risk scoring, device fingerprinting along ML and AI approach for detecting anomalies in payments and combating fraud attacks. The ML models can spot the probability of HTTP referrer is a phishing site and how to react to the phishing scams scenario. Sophisticated risk engine incorporated with AI and ML continuously monitors transactions and detects various fraud patterns along with the actual series of user behavior and continuously monitors and scrutinizes data. Whenever anomalies or fraud attacks happen, frauds can be detected by the fraud management solution in real-time, suggesting enhanced fraud protection layers.

In this rapidly evolving dynamics, the financial domain is facing a radical metamorphosis and customers expect banks to deliver a seamless experience. Smart banks advise today a comprehensive fraud approach demanding the intervention of human touch with sophisticated technology. Hence banks are embracing new technologies which help in flagging suspicious transactions and reducing false positives thereby minimizing losses and optimizing the customer experience.

Embracing multi-faceted and multi-layered security approach

A lot of sensitive information of entities and companies exists with banks. If hackers get access to such sensitive information, then the probability is higher to initiate a breach or fraud attacks. To combat such situations with stronger performance and response, it is becoming crucial for banks to embrace a multi-layered approach to cyber-safety.

Financial organizations must spend in data-ingestion from multiple channels enabling them to make a sound decision on fraud attacks and fraudulent activities. Integrating a series of valid tools like multi-layered approach, biometrics, behavioral analysis supports in minimizing frauds to a greater extent. It also helps in offering the right security level in accordance with the fraud levels.

Enhanced Protection for mobile payments

Many of us use mobile phones to shop online and pay through various channels and gateways. This is the reason cybercriminals are aiming the mobile platform in parallel with others. Whenever any person clicks on any unknown links or downloads any attachments, malware, trojans or virus can get downloaded which could steal sensitive and personal data, which may further lead to the malfunction of websites.

Hence banks should implement multifactor authentication, additional account verification, end-to-end cryptography, fingerprinting device, providing real-time messages, alerts, and emails, proper banking mobile application, investigating behavior analysis, and using secure access with safe online documentation. This can help in monitoring financial transactions continuously, ensuring safety, and blocking fraud threats.

Fraud Risk Management Solution

The fraud management solutions should help banks to safeguard from fraud attacks, detect and mitigate frauds and anomalies.

For an effective fraud management solution, you should bear the below pointers in mind –

Can the fraud management software be integrated with the prevailing software model to enhance the fraud mitigation layer?
Does the fraud management platform support multiple payment channels across different geographical locations?
Is your fraud management solution, providing a deep insight into model analytics or it is just merely a Black Box?
Does your fraud management program meet your expectations and appetite?
Is it possible for your fraud management solution to ingest data from any channel during the customer lifecycle?
Is your fraud management software coupled with intelligent automation, advanced ML, and AI?
Is the fraud management solution able to detect frauds, trigger the right alerts, provide the right investigation, offer recovery or backup plans with appropriate communications?
Is it improving the overall operational efficiency?

In difficult and uncertain times like this, we all are going through a tough phase. We are compelled to stay in isolation and work from home for our safety and protection. We must move slowly, watch out for minute details and refrain from taking hasty decisions. Banks should monitor coronavirus linked scams and implement a good fraud management solution to stay ahead of frauds. Stay vigilant and Be wise.

Coronavirus Crisis | Impact, Sustenance and Security

Posted on March 24, 2020 by admin

The threat is real, and it is here. Crashing stock markets, disrupted supply chains, jolted travel industry, strained economies, and shut down factories, all these are results of the Coronavirus pandemic. Many economies around the world are struggling to contain the spread of Coronavirus, the hardest-hit countries being China, Italy, the US, Spain, Germany, and Iran. There are over 300,000 reported Coronavirus cases globally (according to WHO on 23 March 2020), since the virus first emerged in December 2019 in Wuhan, China. As the whole world is so interconnected, thanks to globalization, Coronavirus has spread to 117 countries in just over two months. It has become one of the greatest threats to the global economy and financial markets.

Being the manufacturing and exporting hub of the world, China holds a major contribution to the world’s GDP. So the economic turmoil in China due to Coronavirus is imperiling global growth. The impact of Coronavirus on the world’s economy and the fear of a global recession is shaking investor’s confidence and is rocking stock prices across countries. The global stock market has witnessed the most massive single-week decline post the financial crisis in 2008. With worldwide conferences, events, and sports around the world being canceled or postponed and travel restrictions being imposed by governments to curtail the spread of Coronavirus; the travel and tourism industry has been severely impacted. Other industries like retail, restaurants, entertainment, etc. have also started to bear the brunt of the pandemic.

Tough times such as this calls for tough measures from governments and organizations. Until vaccination or cure for the virus is available, the best way to curtail the virus from spreading is through social-distancing, which includes travel restrictions and avoiding large gatherings. Governments are imposing lockdowns and placing quarantine measures nationwide. Organizations are providing flexible working arrangements. Coronavirus has triggered the biggest work-from-home movement in history. To swift through the crisis, companies should also focus on effective communication, ensuring trust and disaster planning.

A majority of organizations are providing work from home options to their employees, cybersecurity has become an even bigger concern than before. While organizations are hurriedly implementing these changes, they are exposing themselves to more potential threats like compromised user credentials, organization’s data theft, and phishing attacks. For providing secured remote access, organizations should assess their existing security framework. Technologies like modern Network Access Control, Software Defined Perimeter, and other Zero Trust network access solutions will find more acceptance and witness a sharp growth in demand.

eCommerce Fraud Overview | Fraud in eCommerce

Posted on March 20, 2020 by admin

eCommerce is a big platform, increasing at an unparalleled pace globally; it constitutes a substantial possibility for brands and businesses to sell their goods and services. Consumers in recent times can purchase online products with multiple choices of brands at their ease and comfort. This gives customers an upper edge for an appropriate decision as they can do comparative pricing at a lesser cost without middleman intervention, thereby supporting eCommerce giants to perform at their best. Owing to this, there is an upward trend in online shopping in the last few years and eCommerce is undoubtedly the booming sector in online business.

The rapid expansion of online sales has introduced many competitors and significant contribution comes from online merchants like Amazon, Alibaba, eBay, etc. Online merchants are exploring multiple ways to generate additional traffic and sales. Hence the companies are creating numerous marketing strategies to increase their sales such as holiday sales, Black Friday sales, cyber sales, and much more to generate surplus traffic and sales. eCommerce can provide tremendous advantages if the company can differentiate amongst the genuine customers and fraudsters who are trying to escape amidst the multitude. With eCommerce growth, online fraud is also growing with skilled fraudsters using technology to hack systems, and criminals are continuously leveraging new types of sophisticated frauds.

eCommerce fraud

When a fraudster leverages embezzled payment details or fraudulently obtained bank account or credit card accounts to attempt or make online or retail transactions without the consent of the account or card owner is eCommerce fraud.

Major eCommerce frauds

Merchant Identity Fraud – Fraudsters create fake identities establishing a merchant account that appears to be an authentic business. Furthermore, they rob stolen credit card information to conduct multiple charges then proceed with the earnings prior the cardholder comprehends they have illicit transactions on their accounts and cannot retrieve the funds and held responsible for the damage and penalty.
Friendly Fraud or Chargeback Fraud – Customer pays for the online products using a debit card or credit card. In addition, they intentionally charge-back post after receiving the products declaring they never got the goods. Later, the customer is given a refund moreover the customer keeps the goods that they stated never received. Most of the time, the commodities are sold again to get money.

The other types of eCommerce frauds are Phishing, Clean fraud, Page Jacking, Affiliate Fraud, Triangulation Fraud, and Supplier Identity Fraud.

Online payments, digital wallets are luring more attention from cyber-criminals due to the prevailing limitations making this kind of fraud swift and simple to conduct which is quite often overlooked and unseen by users. Simple and easy pin passwords, non-coded data leverages hackers to exploit more and steal personal details and identities. Therefore, it is imperative for businesses to adapt to eCommerce fraud trends, monitor and analyze them to alleviate fraud risks and vulnerabilities.

In the current scenario, digital evolution is the critical factor for most of the enterprises and their expansion in the market who are embracing new technologies thereby shifting towards merging cashless economy, cloud deployment, mobility, an outbreak of Internet of things (IoT), and automation. The amalgamation of all these systems and technologies is enabling a data-controlled method to mitigate several financial risks and fraud threats throughout the financial landscape.

To combat and alleviate eCommerce frauds some far-sighted measures like ML, AI, IoT, and automation are adopted. eCommerce in the fraud space must be given the required attention and protection with the EFM platform, integrated with advanced technologies, cognitive learning, and automated tools helping to battle and block online frauds from digitalization.

Growing Fraud and Mitigation Trends | EFM Trends

Posted on March 6, 2020 by admin

In this digital era, fraud is getting sophisticated and is the most accelerating concern of this digital age. eCommerce and online payments are growing swiftly, resulting in a gigantic shift to mobile and digital applications, maneuvering to seamless payment executions. Frauds are performed in a sophisticated manner on the dark web leaving the least amount of time for banks and systems to battle frauds. A few of the emerging frauds are money laundering and terrorist financing, account frauds, and identity thefts. Hence, it’s vital for financial organizations to embrace advanced AI, ML technologies in Enterprise Fraud Management solutions as opposed to the conventional approach to block and mitigate financial thefts. EFM solutions aids in reducing operational losses, detecting and alleviating fraud attacks, and maximizing the overall customer experience.

EFM platform provides s real-time screening of transactions across all channels and payment types. An increasing number of internal and external frauds with access to payment card data, personally identifiable information (PII), sim card cloning, and stolen credentials by fraudsters are resulting in a substantial financial and reputational loss. Furthermore, cybercriminals are increasingly targeting mobile channels for login attacks as customers across the global regions are adopting mobile applications for various financial transactions and online sessions.

The banking sector is concentrating on centralizing its risk management process, integrating all the key capabilities, analytics, systems to combat fraud efficiently. They are also emphasizing constantly updating fraud management processes with updated rules and models. Multiple financial organizations are acquiring real-time data of transactions from all channels and external data, thereby helping to enhance the accuracy in the identification of frauds.

The financial sector is experiencing a revolutionary metamorphosis, and higher hopes of customers expect banks to perform a smooth experience. In the modern world of intricate fraud attacks, financial enterprises are incorporating new technology innovation in the EFM solutions for identifying and mitigating internal as well as external frauds in the fraud domain.

Learn more about other EFM Trends here.

Future of ML and AI in Financial Sector | Fraud Management Trends

Posted on February 28, 2020 by admin

The financial landscape is experiencing a revolutionary transformation, and tech-savvy customers expect banks to deliver a seamless and rich experience.

In the ever-growing sophisticated threats, too many frauds must be examined and improved manually. Hence, it is imperative for organizations to incorporate AI and ML-based technologies to differentiate among anomalies and malicious fraud. AI and ML identify patterns and supports the systems in acquiring configuration rule based on the pattern and the information is detected. Furthermore, ML aids in detecting suspicious financial transactions and money-laundering activities in real-time thereby flagging such activities and minimizing false positives.

Regardless of emerging trends of ML and AI in the EFM platform, some enterprises have still not utilized them because of various challenges involved. Such as the integration of ML and AI into the existing business functions and framework, the need for new resolutions to mitigate new kinds of attacks, and others.

Let’s look at the benefits which ML and AI has to offer –

Behavioral Patterns are detected at an early stage using ML and AI analytical models
Ensures safety and security of integration of customers data collated from various channels
It provides deep insights and analytics with visual graphics and a unified dashboard.
Prevents attacks and mitigates fraud.
Offers personalized customer experience.
Includes automation of processes with a minimal scope of errors.
Ensures regulatory compliance.
Enhances the branding of companies.
Optimizes the overall efficiency of the organization.

Due to many benefits and stiff competition, financial enterprises are embracing new technology innovations and integrating intelligent automation with AI and ML into their EFM solutions. The AML software, when joined with ML and AI can offer a lot of benefits like reduction in compliance costs with enhanced and effective solutions. AI and ML are becoming critical, empowering banks to handle the enormous quantity of datasets, combating and preventing fraud and fraud- attacks quickly thereby optimizing profit.

Hence in this ever-changing dynamics in an app-driven planet, it is crucial for banks to adapt to various combinations of AI and ML, supervised and unsupervised ML and technologies, multiple algorithms in accordance with their requirements, and then implementing them into their systems.

Emerging Fraud Trends in 2020

Posted on February 21, 2020 by admin

Let’s sneak a peek into major emerging fraud trends in 2020 to combat frauds. With evolving technology frauds are getting sophisticated. It is crucial for financial enterprises to be vigilant on various emerging frauds, quickly detecting and mitigating them.

SMS Spoofing – is an emerging trend with the increasing use of mobile networks globally, sending bulk SMS by replacing the original mobile number, details with alphanumeric text and using it for deceiving and illegitimate acts. SMS spoofing is also used to conduct APP frauds, using technology to impersonate a reliable such as PSP as a sender of an SMS message. Targets and victims get these messages showing up from banks to which they react and respond thinking it’s from their banks however these are from the fraudsters waiting for an opportunity to commit fraud. The prevalent example of SMS spoofing is the text message comprising links to mobile malware suck links if clicked by mistake could lead to a malicious app being installed on your mobile thereby stealing your identity or valuable files for redemption.
Authorized push payment fraud (APP) – FCA (Financial Conduct Authority) executed a rule with effect from 31st Jan 2019, enabling victims of APP fraud with specific criteria to complaint to both, the sending PSP and receiving PSP supplier and not just to the sending PSP. Implementation of this rule has helped in reducing the fraud rates thereby fighting real-time payment fraud. This also is trending as a strong layer in managing data integration and leverage analytic insights thereby minimizing and combating APP fraud.
e-Commerce Fraud – With e-commerce growth, online fraud is becoming sophisticated with the use of the latest technology to hack systems, such as online payment fraud, identity fraud, mobile fraud, digital wallet fraud, data breach, and loss of personal data. ECommerce in the fraud space must be given the required attention and protection with the EFM platform, integrated with advanced technologies and automated tools helping to combat and mitigate evolving online frauds.
Social and Voice Banking – Financial organizations are using innovative channels like social and voice banking such as Alexa, chatbots which are developing avenues for automated systems. With new channels come new challenges such as registration services are not robust and have certain loopholes which the cybercriminals take advantage of and conduct frauds.
Breaching 2FA – LinkedIn, Gmail, Facebook, Skype, and Google are using two-factor authentication (2FA) which creates a second layer of security curbing data breaches and identity attacks. However, cybercriminals and hackers are tech-savvy, conducting sophisticated frauds using technology to their advantage are accessing personal information, compromise systems, and clear bank accounts or take over the accounts (ATO).

Increasing Identity Theft and Synthetic ID Fraud – Financial landscape is experiencing a revolutionary transformation, and tech-savvy customers expect banks to deliver a seamless experience. In the era of sophisticated threats, it is imperative for organizations to utilize AI and ML-based technology in EFM, to differentiate among anomalies, suspicious and harmful frauds. AI and ML are becoming critical, empowering banks to manage large volume datasets, early detection of behavioral patterns, ensuring safety and security of data integration, deep analytics insights, personalized customer experience, automated systems, reduced false positives, optimized operational efficiencies, reduced costs and maximized profits.
ATM Fraud – Increasing ATM services by banks such as real-time payments, card-less cash withdrawals are also leading to sophisticated fraud attacks such as card skimming and card shimming attacks, leading to emerging growth in ATM fraud and attacks.
Deepfakes and Voice Biometrics – Voice-fraud is the latest form of deepfake technology, emerging as a major threat in the fraud landscape. Fraudsters recently made headlines in the USA for deep faking voices of various CEO and established people. Conmen are perfecting deepfake to impersonate people to conduct fraud. With advancing technology, it’s really challenging to differentiate between original identity and fraudster. Cybercriminals may use deepfake on a larger scale to attack the C-suite and PSP’s verification measures to perform financial fraud.
Institutional Disruption – Cybercriminals are constantly hunting for large-scale campaigns causing disruption. They can perpetrate data of bank mergers and acquisitions by asking customers to re-verify credentials, update data and settings resulting in ATO attacks. Institutional disruption is likely to rise in the near future.
Digital Transactions – The new Age digital transactions are significantly Increasing Enterprise Risk Landscape and Vulnerabilities. Digital transformation is the foundation of most enterprise strategies today, and its increasing pace is significantly impacting technologies thereby drifting towards the integration of cashless economy, cloud adoption, mobility, the explosion of the Internet of Things (IoT), and deploying new solutions. The integration of all these systems, technologies are enabling a data-driven approach posing various security threats, as these inter-connected systems accelerate the speed and threats of attacks across the financial globe.

Enterprises are battling security issues with the increasing network complexity, rising gaps in security protection, polymorphic attacks, and compliance issues. It’s imperative for businesses to be secure, vigilant, and follow security best practices such as integration, automation, using technology and data to drive innovation. With the ever-growing digital transactions, enterprises are digging in real-time data analytics and blockchain integrated with cognitive learning to prevent risks arising from digitalization.

In 2020 financial enterprises are embracing new technology innovations and integrating intelligent automation with AI and ML into their EFM solutions. It is time, financial organizations to think differently and take advantage of updated technologies and integrate them into their processes.

Increasing Fraud and Information Theft | EFM Trends

Posted on February 14, 2020 by admin

There is a significant shift in the fraud landscape, with increasing fraud risk rapidly growing across the financial institutions. Fraud is cited as the most accelerating problem of the digital world. Exposure in online payments is on a rising toll, resulting in a big switch to mobile and digital apps, leading to swifter and smooth payment executions. Due to this, banks and systems get less time to detect and identify hidden funds when required. Furthermore, fraud is conducted in a sophisticated manner in the deep dark web.

Major types of emerging and increasing frauds

Money Laundering and Terrorist Financing – Both money laundering and terrorist financing goes arm in arm, firstly illegal money is laundered then sponsored for terrorist activities.
Identity Fraud/Thefts refers to a crime in which the criminal acquires and use the victim’s data particularly in extracting his/her money or credit in an unlawful manner through illegal ways for wrong motives such as making transaction, online purchases or getting a tax rebate. The contextual information of people is sourced through loan application forms, online purchases, digital wallets, mobile banking, internet resources, from lost or stolen wallets or phishing frauds, or through medical and financial data.

Types of Identity Thefts

Account Takeover (ATO) refers to inappropriate use of credentials (name, signature, etc.) and seizes control on a bank account without the owner’s permission and fraudsters performing unauthorized transactions such as fund transfer, online transactions, and shopping.
Driver’s License Identity theft is a prevalent form of Identity Theft. The person involved in stealing your identity may purchase things in your name also manage to obtain other forms of identifications with their photo and use them for unlawful activities.
Mail Identity theft is a very popular identity theft (ID) in which the criminals steal your sensitive and personal information to access your financial data, then make purchases, or even apply for new credit cards.
Online Shopping fraud / Ecommerce thefts refer to a criminal accessing customers’ payment or sensitive information through hacking systems later using them to purchase groceries, clothes, or goods online without the owner’s knowledge.
Social Security Number Identity theft could happen from tax identity theft or even circulars floating in your mailbox. With the stolen SSN numbers the thieves can easily commit crimes and fraud in your right name or also create another identity, exploit further for their selfish intentions.
Senior / Elder scams are crimes in which the elders are targeted with all kinds of schemes; criminals take advantage of their isolation and lack of technical know-how. The elders are soft targets and can be easily duped by taking their account or card information and used for criminal activities.
Email compromise (entity/business) is an increasing phishing fraud; the criminal takes control of your business email account by a hacking password then conducts wire transfers and such unlawful activities.
Insurance Fraud is any act executed to deceive an insurance process. Insurance fraud occurs when an individual or establishment makes incorrect insurance claims to acquire advantages or remuneration for which they are not entitled to or owned.
Credit Card and Debit Card Fraud is an example of Identity Theft (ID) in which both the cards are used without the owner’s knowledge to make unauthorized purchases, shop online / offline, or retrieve funds using the victims’ account.

Fraud identification and mitigating frauds are the heart of every risk management system. Banks select EFM solutions with features satisfying their overall work processes and framework requirements. Several functions and features are important to be considered while making an EFM platform selection. It should detect and prevent frauds across all channels, considering a lot of aspects such as customer financial data, mobile data, user access data, user demographics, financial patterns, etc.

Financial institutions experience hidden challenges while integrating the EFM platform into their system such as reducing losses, detect and mitigate rising frauds and enhance the customer experience. The fraud management solution should also consider integrating options, smooth arrangements, customer service experience, machine models, e-commerce fraud combating solution with a combination of ML and human intelligence, and much more. Banks are adapting updated technologies in EFM solutions against legacy methods to prevent and combat identity thefts.

The Rise of Blockchain Technology in Risk Landscape

Posted on February 7, 2020 by admin

Blockchain is a database framework that is divided and shared within the network framework, maintaining a record of each cross-border payment transaction. All such transactions and data entries are recorded in a specific sequence and non-changeable order which are chained together in blocks, giving the technology its name.

Blockchain aids not only in identifying frauds but also safeguards the links within the blocks and contents by encrypted data, this way the prior transactions cannot be damaged or forged. The cryptographic format supports the early detection and mitigation of fraud in the risk domain. It’s a rapidly emerging solution for secure, swift, and cost-effective money remittance service. Markets that are distinguished by reduced penetration, heavy demands for banking services, increased level of mobile penetration, etc. should adopt Blockchain for enhanced remittance services.

It offers an array of benefits such as allowing peer-to-peer (P2P) transactions, ensuring safety and transparency, mitigating frauds, cybersecurity, and optimizing operational costs. Due to this financial sectors are allocating better resources to apply Blockchain technology into their systems. Blockchain technology has the ability to build faith and transparency in organizations. Furthermore, supporting in the verification of documents of various entities and products, providing automated transactions, and reducing forged remittances.

Emerging establishments are gearing up to take advantage of Blockchain technology in their flourishing payment markets. It also helps in swift and secured cross-border money remittances with minimal intervention of middlemen, thereby saving costs on money remittances and minimizing losses caused due to frequent fluctuation in currency value.

Blockchain technology has the potential to transform the conventional business model to modern systems thereby ensuring safer, swifter, and cost-effective transactions with minimized frauds. We all should be aware, Blockchain is here to transform the banking sphere.

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Tag: Enterprise Fraud Management