Are banks doing enough to curb fraud?

Posted on: December 18th, 2014 by Art Barger

With more and more customers turning to Internet banking, one of the most concentrated areas of security for financial institutions is the online channel. This focus, however, doesn’t mean their enterprises are foolproof.

Despite all the resources and expenses today’s organizations dedicate to protecting their electronic channels, many believe it is still not enough. With fraud tactics moving faster than corporate initiatives, by the time a new upgrade is deployed criminals have likely moved on launching attacks that circumvent other system vulnerabilities.

High-profiled hacks like Sony and The Home Depot are not a result of a lack of money or effort. These and other leading companies have got the resources and wherewithal to protect their customer environments. The problem is hacking, in whatever form it takes, is an ever-evolving machine. Criminals are not only good, they’re highly persistent organizations that are evolving faster than security solutions can be developed.

When it comes to protecting your banking customers, we know that crooks don’t limit themselves to a single channel. With online banking increasing, you can bet thieves are doing everything they can to penetrate this channel. But when businesses can successfully thwart online fraud attempts, crooks look for other gaps in the system, which includes different customer channels.

With so much focus on e-commerce, more traditional channels such as the telephone can become susceptible to different threats, including social engineering. The truth is, bad actors are everywhere. They really don’t care which channel they go through to access your data. They’re simply looking for the easiest way in.

For risk managers, fraud is a constantly moving target. Knowing this, it’s just possible that not all businesses are doing enough to stop effective stop it. This is why it’s so important to continually evaluate your defenses across all customer channels. If your entire enterprise doesn’t have an effective layered security approach to identifying and stopping fraud, it’s going to be difficult to spot potential threats to your system. For example, not having a multi-layered authentication process in place to proactively identify the hundreds of thousands of inbound telephone calls each year will leave your call center and IVR system open to threats that can lead to account takeovers, exposure to customer sensitive data, and fraudulently purchased lines of credit.

The TRUSTID® Physical Caller Authentication solution provides an important layer of security that, when coupled with other customer-identifying tools, can effectively prevent perpetrators from defrauding your business. We do this by invisibly verifying each calling device’s physical location to understand the level of risk. By knowing if a Caller ID or ANI is spoofed before it enters the telephone system allows banks to take action in real-time against known bad calls, as well as allow good calls to get to your call center agents faster.

Ultimately, reducing fraud rates and improving your customer experience is about detecting threats sooner and acting on real-time information across all business channels. While some channels may seem more important than others, it’s just as critical to safeguard the ones that can sometimes get less attention. Because those may be the channels criminals are eyeing next.