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Multi-Channel Fraud Detection: A True Horror Story

October 31, 2017
Read Time: 0 min


Multi-Channel Fraud Detection Won’t Catch Everything


Some of us might be trick or treating today and others may opt out for a good ‘ole scary movie and pajamas. After all, Halloween is the best time to listen to horror stories and get spooked, right?

Most of us, at some time in our lives, have turned down the lights, put on a thriller and wait to get scared. Often times you catch yourself yelling “look behind you!” or “run faster!” to the victim getting chased on the screen. I’m sure we’ve all done it. We’ve seen something about to happen and try to warn a character in a movie, as if they are able to actually hear us. What if this scenario happened to you? Not in an ACTUAL horror movie, but when you are trying to protect your institution from criminal activity.

What if someone was telling you “watch out!” when you were monitoring accounts for fraud, but you couldn’t hear them?  Is it that you can’t hear the warning, OR MAYBE is it because you aren’t being alerted at all?

If you have transaction monitoring software, you may think this is a farfetched scenario, however, what if your system isn’t built to think the way that it should (to also protect you against single channel fraud)? What if your system doesn’t alert you of fraudulent activity and you are caught off guard by the fraudster monster that traps you in the corner? What losses are you looking at? Hundreds of thousands? Millions?

Unfortunately, this does happen in real life. There are systems that will only produce alerts if there is multi-channel activity on an account, leaving financial institutions unaware of fraudulent transactions and trapping them in a true financial fraud horror story.

For example, if a washed check for $200,000 dollars was deposited into an account, which was 4x the amount of any other check previously deposited into that account, would your transaction monitoring system alert you of this activity? If you are on a system that doesn’t have the capability to produce alerts on single channel transactions your financial institution is at risk for great loss.

For some horror stories the monster gets away and leaves the victim (financial institution) shaken up. Fortunately, just like in horror movies, there are rules to help you survive and in this case help prevent your institution from becoming the victim to a large fraud loss.  [/vc_column_text][/vc_column][/vc_row][vc_row][vc_column width=”1/2″][vc_custom_heading text=”Here are 4 rules to follow to successfully survive a financial fraud horror story.” font_container=”tag:h3|font_size:16|text_align:left|color:%230a0f69″ use_theme_fonts=”yes”][symple_bullets]

  1. Beware of High Dollar OutliersMake sure your system triggers an alert for an item that exceeds a customer’s recent transactional high dollar amount. 

    Review large dollar items to ensure their validity.

  2. Look out for sudden transactions – Make sure your system will alert you when there is sudden activity on an inactive account. 

    Be sure to review any activity out of a customer’s historical norm.

  3. Review transactions over a thresholdMake sure your system sends you an alert when a transaction is over a set threshold. 

    Transactions over set thresholds can mean more that just a life qualifying event.

  4. Golden Rule – Don’t assume fraud is only tied to multi-channel transactions. 

    Know that fraud and BSA are two different animals and have different forms of detection.

[/symple_bullets][/vc_column][vc_column width=”1/2″][vc_single_image image=”1944″ img_size=”full” alignment=”center” style=”vc_box_rounded”][vc_column_text] Remember the scary movie series, Scream? They mention the “RULES TO SUCCESSFULLY SURVIVING A HORROR MOVIE”. In the series you frequently hear about the importance of follow these rules to survive. Sometimes it’s the rules that save us from being a victim in a horror story.   [/vc_column_text][/vc_column][/vc_row][vc_row][vc_column][vc_column_text]

Don’t let the fraudster monster sneak up on you. It’s important that you are able to hear the “watch out!” from your system and get the warning you need to survive and run faster than the fraudster. Remember, rules are important to protecting your institution from loss. Make sure your system has the capability to alert you when fraud happens on a single channel.

  For more information about Banker’s Toolbox and our Fraud software, visit our product page or speak with one of our experts.


About Abrigo

Abrigo enables U.S. financial institutions to support their communities through technology that fights financial crime, grows loans and deposits, and optimizes risk. Abrigo's platform centralizes the institution's data, creates a digital user experience, ensures compliance, and delivers efficiency for scale and profitable growth.

Make Big Things Happen.