How Irish organisations can work together to beat sector-agnostic fraud
By Martin Brennan, SAS Ireland
Some say ‘it pays to diversify’ during tough economic times, and that’s certainly true for people looking to commit fraud. Modern fraudsters don’t specialise in banking, insurance, tax or welfare crime; they simply take the path of least resistance to get their hands on the cash, regardless of industry or channel. So it’s essential for private and public sectors to think in the same way, and work together to beat the would-be criminals.
This was a key message from Stephen Harrison, former Chief Executive of the UK’s National Fraud Authority (NFA), at the recent SAS Ireland Fraud, Waste and Error Knowledge Exchange event. Stephen was responsible for the NFA’s Fighting Fraud Together strategy, so he had some great insight about what’s being done in the UK to prevent and disrupt fraud.
Unfortunately, Ireland is some way behind the UK in our approach to combating fraud. To work together, industry and government will need to share and analyse information to build a 360-degree picture of fraudsters, identify patterns and relationships, and prevent more fraud.
Yet many Irish organisations still struggle to share and analyse information internally – let alone with competitors or other industries. So how can we possibly work together to tackle fraud? Overcoming the hurdles may not be easy, but there are two fundamental steps that need to be taken if we are to succeed:
Understand data protection
Stringent data protection rules are often cited as the reason for not sharing information. Yet the Data Protection Act states that the processing of personal data “is permitted for the purposes of the prevention, investigation and detection of payment fraud”.
Failure to do so is a huge missed opportunity. At the very least, organisations should get better at sharing data internally, e.g. giving fraud teams access to marketing data to enable a more complete view of individuals. Only then can we hope to share data externally and for the greater good.
Embrace a hybrid, real-time approach to analytics
Fraudsters are always evolving. As soon as organisations know what to look for, the criminals change their methods and slip through the net. Analytics that only look for known types of activity can therefore only reduce fraud by so much and leave organisations exposed to great financial and reputational risk.
So it’s essential to invest in hybrid analytics that can identify existing types of fraud AND explore all the data to find new and unexpected patterns. And they’ll need this to happen in real time to catch criminals before serious money is lost. The SAS Fraud Framework is such a hybrid approach. It combines rules and anomaly alerts with predictive models and social network analysis to identify, predict and prevent more fraud.
Get top-down support
The success of a cross-sector approach to combating fraud will depend on support from senior figures from industry and government policymakers. SAS Ireland continues to work with both to foster debate and encourage progress.
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Modern fraudsters don’t specialise in banking, insurance, tax or welfare crime; they simply take the path of least resistance to get their hands on the cash, regardless of industry or channel. So it’s essential for private and public sectors to think in the same way, and work together to beat the would-be criminals.