When it comes to protecting banking customers from criminal activity, credit card issuers do a good job resolving problems after they’ve occurred. The messy part comes with the clean up, which costs banks valuable time, money and resources. If financial institutions expect to better protect their customers and reduce fraud rates, they need to focus on the two most important aspects of fighting fraud — detection and prevention.
In the article, “Study: Credit Card Issuers Can Do More on Safety,” Javelin Strategy & Research found that credit card companies do an effective job resolving fraud problems once they are discovered, scoring an average of 18 out of the 20 points allowed. However, when it comes to catching fraud beforehand, the numbers drop dramatically. Card issuers average just 24 of 45 points for prevention, and 17 of 35 points in fraud detection.
According to Javelin’s managing editor of security, Phil Blank, falling short in fraud prevention creates a major vulnerability in securing banking systems.
“The most troubling area is prevention. Prevention, frankly, is the area that has the biggest payback, not only for the [FI], but for the consumer as well.”
In the telephone channel, building a safe and trustworthy banking environment is essential to protecting customers’ accounts and a bank’s overall business reputation. To prevent fraud before it happens, financial institutions need to deploy authentication solutions that enable them to detect when a suspicious call is coming into their call center. As bank call center agents field millions of customer calls per day, this requires banks to automatically validate a customer before the call is answered.
While most security solutions still focus on knowledge-based authentication (KBA) to identify customers over the telephone, these tools are becoming less predictive at stopping today’s smarter, more sophisticated criminals who know how to manipulate ANI and Caller ID to slip passed knowledge-based defenses.
The TrustID® Telephone FirewallTM solution restores physical security to ANI and Caller ID to instantly authenticate inbound phone calls before the call is answered. This provides financial institutions with real-time telephone network forensics needed to detect and prevent suspicious calls from reaching a bank’s call center. Invisible to criminals and undetectable to good customers, TrustID helps banks effectively manage fraud, make quick, accurate decisions for everyday activities such as bankcard activation, money transfers and new account applications, and improve the overall customer experience and brand loyalty.
