FFIECs Guide For Fraud Prevention and Why Its Not Working

  • Legislation

In the 2013 Faces of Fraud survey, it was found that even with financial institutions increasing their fraud prevention efforts its still not enough to stop fraudsters. Financial institutions and banks make big investments in fraud prevention and stronger online security, but accounts are still being compromised. Instances like credit card, check, ACH and wire fraud are of main concern when it comes to threats. Despite the investments made for security control, these preventative measures arent stopping threats and attacks.

The FFIEC updated their authentication guide, which recommends dual-customer authorization, fraud detection and monitoring, enhanced customer education and IP reputation-based tools. But nearly half who took the survey say those controls have not reduced the number of account takeover incidents in the past 12 months. Sixty-five percent of them said that customers resist the controls theyve implemented, making it hard to secure their accounts and data.

The majority of institutions who were surveyed responded that financial losses to fraud have either increased or remained steady over the past year. Financial Institutions need to make it a point to educate their customers about fraud. Layered security is no longer an option for customers to decide upon. Banks need to implement fraud prevention solutions beyond the FFIEC guidelines. By implementing drivers license verification, fraud scoring, high-risk alerts and more, financial institutions will be able to increase fraud prevention services and decrease attacks.

 

[Contributed by EVS Marketing]