Bankloch

Payment fraud (i.e. the unauthorized or deceptive use of stolen payment information to obtain money, goods, or services) remains a major challenge for financial institutions. With new regulations requiring banks to compensate fraud victims, fraud prevention has become a top priority. However, fraud techniques are evolving rapidly, often outpacing even the most diligent security measures. This blog explores the types of financial fraud and the strategies institutions use to protect customers. In this article, we categorize payment fraud into six primary types and discuss the tactics behind each. Account Takeover and Identity Theft : Fraudsters gain unauthorized access to a customer’s account and initiate transactions under the customer’s identity. Authorized Push Payment (APP) Fraud : Customers unknowingly authorize payments to fraudsters. Deposit Scams : Fraudsters trick customers into believing they have received a legitimate deposit. Internal Fraud : Employees manipulate or intercept...

In July of this year, the world was shocked by a major IT incident caused by an update from the cybersecurity firm   CrowdStrike . A wrong patch led to a global IT outage, affecting 8.5 million Windows devices and causing the cancellation of more than 5,000 commercial airline flights. This incident also impacted hospitals, media, and banks, resulting in an estimated $1.5 billion in losses. Dubbed the "Largest IT outage in history," this event highlighted the vulnerabilities in our interconnected digital world. While this particular incident grabbed global headlines due to its scale,   massive IT outages are becoming increasingly common . As companies rely more on cloud services and many depend on the same IT software, the risk of widespread disruptions grows. Here are some notable examples of major incidents in recent years: Atlassian JIRA Outage   (April 2022): Atlassian is used by many major corporations for managing their IT departments (via software like JIRA, Conflue...

  Preventing fraud is a major concern for every financial institution. Banks, in particular, must ensure that only the rightful account owner accesses their account and that no incorrect payments are made. This involves tackling issues such as identity theft, accidentally misdirected payments, and Authorised Push Payment (APP) fraud. While a few years ago, this was limited to implementing more complex authentication methods, today banks use a multitude of techniques to protect their customers. This is especially important as banks try to avoid that increased security impacts user experience and leads to more customer questions and complaints to the bank’s customer support. More and more, fraud protection is being considered a competitive differentiator, rather than a necessary cost. Let us explore in detail the different techniques deployed by modern banks. Ensuring the Right Person Accesses the Account This is the first step in avoiding fraud. Unfortunately, it is easier said than...