4 Ways Banks Can Improve Their Fraud-Fighting Efforts
Pursue The Convergence Of Biometrics & Mobile
It’s nothing new that banks are prime targets for all sorts of cybercrime and fraud. The threat of Distributed Denial of Service (DDoS) attacks and phishing expeditions, for instance, is constant. However, efforts to enhance fraud-prevention and detection capabilities, such as requiring customers to use multi-factor authentication, has the potential to diminish a good customer experience.
The bulk of fraud losses continue to come from traditional payment methods such as credit cards, debit cards and checks. However, one of the current fraud threats that the industry battles today is account takeover. This is partly due to difficulties in accurately authenticating the customer as they are transacting with the financial institution, even in the branches and call centers. Account takeover results from criminals taking advantage of the vast amount of personal information freely available on the Internet, through malware and spear-phishing attempts, the utilization of social engineering tactics and the compromise of data from merchant and processor breaches.
These threats do require enhanced methods like multi-factor authentication. Financial institutions continue lead the pack in fraud detection and mitigation, but are still dependent on using customer information and passwords that are readily available and easily compromised. Technologies that use biometrics for authentication are on the horizon and could make a difference with this issue. The use of mobile devices for things like fingerprints, voice recognition and visual identification appears promising and much more difficult to compromise. Financial Institutions also need to combine all available data to enhance their ability to identify anomalies in all aspects of customer interaction.
Educating and enlisting customers in the fight against fraud must remain a priority. In addition, the biometric technologies mentioned are beginning to be incorporated into the mobile devices which have become ubiquitous throughout the world. These techniques, along with comprehensive data analysis,g may be able to enhance the institutions ability to properly authenticate without inconveniencing the customer.
-- Nancy Guglielmo, Vice President of Fraud Reduction, BITS