Criminals will seize any opportunity to run their scams, as seen with the skyrocketing cases of cyber fraud throughout the pandemic.
Before the pandemic hit, virtually every large enterprise was engaged in some degree of digital transformation. Aiming to gain a range of business agility and efficiency benefits, they were rebuilding their business models and key processes on digital foundations. Some organizations were moving aggressively in this direction, while others were taking a more measured pace.
Then COVID-19 changed everything.
The U.S. economy was largely shut down. Everyone except ‘essential’ employees were told to stay home. For how long? Nobody really knew.
Banks and credit unions worked to create or ramp up online processes for digital banking and closed in-person banking.
As with any rush job, this dramatic pivot involved some corners being cut, some standards loosened, and even some rules being broken. But that’s what was required of IT groups, network operations teams, and business unit leaders to accomplish their objectives.
In a recent FiVerity webinar: Defining the Synthetic Identity Fraud Threat, Staci Shatsoff, Associate Vice President of the Federal Reserve Bank of Boston’s Secure Payments group, captured the situation:
“Digital transformation was certainly going on before COVID...with the pandemic hitting, banks had to quickly pivot in order to make services available for their customers. And in doing so, you don't necessarily have the time to put the proper controls in place. So, what the pandemic has done has potentially increased the magnitude for all types of fraud, with synthetic certainly being one of them.”
Ms. Shatsoff continued, “How we, as an industry, make ourselves better prepared and put some of those controls in place is something to think about.”
As the finserv industry puts technology and processes in place to properly implement rushed digital transformation projects, it’s clear that fraud detection should be a priority.
Legacy, rule-based fraud detection systems are too slow and rigid to fill the gaps that fraudsters are exploiting today.
The good news is that new resources like FiVerity’s SIF Detect are available to prevent these sophisticated forms of fraud. Regardless of the organization’s degree of digital transformation, it’s clear that most banks and credit unions will be well-served by faster, more intelligent, and scalable anti-fraud tools.