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AML/CFT Financial Elder Abuse Fraud Prevention Financial Elder Abuse Fraud Trends

First Citizens National Bank | Fighting Elder Financial Exploitation with BAM+

The Problem: Preventing Elder Financial Abuse, a Growing Problem

Elder financial exploitation (EFE) is a crime that affects thousands of older adults every year. It is a growing problem with an estimated $36 billion stolen annually, money that causes irreparable damage to an older person’s livelihood. As banking becomes more digital and relies less on face-to-face interaction, it can be hard to catch potential cases of EFE before it is too late. Chris Hamm, the BSA officer at First Citizens National Bank, prides himself on educating the community on the risks and red flags of EFE. He spends significant time speaking at Chamber of Commerce events, retirement homes, and national conferences to inform others on the harm of elder financial exploitation and how to spot it. Chris trained his front-line staff in what to look for and what questions to ask. Over the last five years he noticed a significant shift in their customer base’s behavior from in-branch transactions to digital activity. The problem now became how do you stop fraudulent or abusive activity you can no longer physically see in your branch?

Without BAM+, there is no way we would be alerted to some of these potential elder financial exploitation cases.
Chris Hamm | BSA Officer

The Solution: Using Single- and Multi-Channel Fraud Detection in BAM+  

Chris and his staff were still relying on the front line to catch most instances of EFE but as he noticed the shift to more digital transactions, they used BAM+ to create an optimized scenario to target this specific type of behavior. BAM+ fraud scenarios uses single- and multi-channel fraud detection to better spot potential EFE. Chris noticed most of the transactions related to EFE included outgoing cash, mainly for money orders, and ACH transactions, typically debit card transactions for even dollar amounts signaling they were purchasing gift cards at convenience stores. Once they adjusted their filters and parameters to catch incoming and outgoing ACH and cash spikes for account owners 65 years and older (the legal definition of an elder adult in Tennessee), they were able to identify better and stop potential EFE cases based on transactional red flags. “Without the software, there is no way we would know about some of these cases,” Chris said. “If the customers are not coming into the branch where a front-line member can recognize a red flag and alert us, we would not catch it.” Chris was able to talk to the victims after just the first alert and hopefully prevent them from losing more money to bad actors.

 

The Outcome: Able to Better Educate Community, Protect Elder Population

Over the last 24 months, Chris and his staff saw a 50% increase in cases related to EFE because they were able to identify potentially suspicious activity better, saving their customers $100,000s in potentially fraudulent transactions. The internal central case management system in BAM+ helped Chris keep a running record of the necessary supporting documentation to make it easier to file SARs related to those cases. In one case, Chris prevented an elderly customer from wiring out $70,000 in a romance scheme, nearly her entire retirement savings, because he was alerted to the potential fraud from the very first transaction thanks to BAM+ and having their scenarios optimized. “BAM+ raises a literal red flag to potential elder financial exploitation by alerting us to transactions that fit within specific parameters that are consistent with EFE,” Chris said.

First Citizens National Bank harnessed the power of BAM+ to help better protect their elder customers from potential exploitation.

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