A group of the top U.S. banks have joined together with First Data to combat fraud. Early Warning Services, the name given to the alliance between five of the nation's leading retail banks -- including Bank of America, BB&T, JPMorgan Chase, Wachovia and Wells Fargo -- will bring together the fraud prevention expertise of its financial institution owners with the intellectual property and assets of First Data fraud prevention subsidiaries Primary Payment Systems (PPS) and IDLogix to better fight fraud.
Early Warning Services will help financial institutions and other businesses assess risk when establishing and servicing their customers. The company will integrate information and technology to fight identity and payment fraud. This intelligence will be delivered through a suite of Early Warning fraud solutions, resulting in more than $1 billion in annual loss avoidance, according to the organization.
"We're confident this new venture will strengthen the industry's defenses in the fight against fraud," said Leslie Altick, executive vice president, Wells Fargo and vice chairman of Primary Payment Systems' board of directors, said in a statement. "We believe that by working together we can achieve a common goal that none of us could have achieved individually."
"First Data believes strongly in collaborating with financial institutions as partners," said David Bailis, president of First Data's financial institution segment, in a release. "This announcement signals our joint commitment to fighting fraud. Bringing together First Data's technology competency with the knowledge and best practices of the bank owners expands upon the efforts put forward by Primary Payment Systems."
According to recent studies, fraud costs financial institutions and retailers more than $50 billion each year, and this year, more than 8 million Americans will have their identities used for fraudulent purposes.
"As fraud continues to reach new levels of sophistication, the speed with which current and accurate information is integrated into the processes that detect, prevent and deter fraud becomes even more critical," said Paul Finch, CEO of PPS and future CEO of Early Warning Services, in a statement. "Our history of delivering value has been built upon the active participation of financial services organizations of all sizes. We are now better positioned to harness the best practices and experiences of some of the leading financial services organizations to meet the growing fraud challenges of the industry."