The Knowledge Exchange / Risk Management / Fraud is a hidden tax to all of us

Fraud is a hidden tax to all of us

I recently had the pleasure of being interviewed about fraud in Canada by Mark Bunting, the host of Business News Networks, The Close. Fraud remains a huge problem around the globe, and Canada is no exception. In fact, many have argued that Canada’s fraud penalties are not strong enough to serve as an effective deterrent – making Canada a hot bed for all kinds of fraud. Surprisingly, according to a recent SAS-commissioned study of more than 1000 senior Canadian business executives in mid- and large-sized organizations, even though the vast majority (80 percent) of them admitted that fraud prevention and detection were a priority, only 9 percent are using business analytics software effectively to help detect fraud! 

Criminals have the advantage in the world of fraud because organizations need advanced analytics to sift through volumes of data and transactions to make accurate, real-time decisions to detect and prevent fraud. A technology infrastructure with end-to-end data integration and advanced analytics that integrates network analytics, fraud detection and prediction, alert management and case management is a must for organizations that want the upper hand in preventing, detecting and fighting fraud in any form, at any touch point.

With Big Data as the latest tech word du jour, only organizations that are using their vast amounts of information effectively to help drive greater insight in fraud detection will stand a chance at winning in the world of fraud.

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One Comment

  1. Luc@5W
    Posted February 3, 2012 at 2:13 pm | Permalink

    After 12 years spent at Canadian FI’s in various fraud strategy roles, I can honestly say that the biggest problem is ‘the bank’ itself.
    For some, especially small ones, fraud is truly a big issue, and they will go far and beyond to reduce it, to make sure that they are covered, as fraud might have a significant impact on the bottom line. But the big ones are different, they have fraud department that are there not for true fraud prevention fight, but more from the customer service experience, to please the customer, to ensure customer happiness not financial bottom line targets.

    In my personal opinion, banks are able to significantly reduce fraud losses. If only they would allow a ‘bit’ of creativity and a ‘hint’ of aggression (declines, referrals). And last, big data is great, no doubt, but…
    let’s put the customer in the driver’s seat! Sounds crazy, sounds blasphemous, but for an ever growing number of self-conscious customers, that might be the answer (combined with traditional methods).

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