CNG Holdings zaps third-party and synthetic fraud with ‘identity-first’ fraud prevention

SAS Identity 360 on Microsoft Azure enables the Cincinnati-based lending and leasing company to fight fraud and power decision making across the customer journey

Having eliminated nearly all third-party and synthetic identity fraud in its online retail businesses, CNG Holdings has expanded its cloud-based anti-fraud platform by SAS. The consumer financial services company – whose consumer lending brands include Allied Cash Advance, Check ‘n Go, and Xact – recently launched SAS® Identity 360 on Microsoft Azure in its leasing business, SmartPay.

Since initially deploying the software-as-a-service offering in 2019, CNG’s extraordinary results to date include:

  • Near-zero false positives. CNG has achieved a mere 0.8% fraud false-positive rate, according to Rick Cooney, Vice President of Fraud and Identify Management at CNG Holdings. “Our fraud false-positive rate almost doesn’t exist,” he said.
  • Dramatically streamlined – and highly accurate – fraud investigations. “An investigation that used to take two hours now takes two or three minutes,” said Cooney.
  • Significant cost savings. By replacing a disjointed patchwork of expensive and ineffective fraud tools with SAS’ integrated defenses, Cooney estimates that CNG cut its fraud program costs more than 30%.

“The results speak for themselves,” said Stu Bradley, Senior Vice President of Fraud and Security Intelligence at SAS. “CNG’s approach is one to be admired and emulated throughout the industry.”

Achieving ‘home field advantage’ with identity analytics

With nearly four decades spent on the anti-fraud frontlines in financial services, Cooney likens fraud fighting to a game of whack-a-mole. Quash one fraud avenue, and fraudsters simply find and exploit another weakness.

“When I came to CNG four years ago, they'd already been hit by a number of large-scale fraud attacks, and I had this idea,” said Cooney. “What if we stop playing the ‘fraud game’ and start playing the ‘identity game’? Make the fraudsters play on our field. With a discrete focus on digital identity, we’ve got home field advantage for solving digital fraud.”

After evaluating several vendors, CNG chose SAS for its best-in-class fraud analytics and machine learning capabilities, robust decision engine and sheer speed. A few months after signing the contract, the solution was running identity-based fraud decisioning for CNG’s online lending and roughly 1,000 retail stores. The results were astounding: a greater than 80% drop in third-party fraud in 90 days by aggregating data from seven sources with SAS. And CNG’s success rate soared even higher as it expanded multifactor authentication, biometric support and data enrichment.

Today, by Cooney’s account, “CNG has virtually eliminated third-party and synthetic identity fraud, to the extent that it is no longer a business issue.”

As an example, he cited one organized crime ring that crammed thousands of fraudulent credit applications into the system in a two-month attack. Among 8,500 attempts, only three beat SAS’ layered defenses – through a social engineering ploy that CNG’s fraud team immediately identified and remediated.

The solution is also catching first-party fraud by flagging potential identity manipulation and data discrepancies. Cooney attributes CNG’s tremendous anti-fraud success to SAS Identity 360 on Microsoft Azure.

“SAS is our air traffic controller,” said Cooney. “We push all our applications through the identity platform that SAS developed, and we are linked to all the different data sources and vendors that we need to process those applications from a digital identity standpoint.”

Beyond fraud detection and prevention – decisioning across the customer journey

By breaking down silos – first between its brick-and-mortar retail locations and online lending business, and later its leasing arm – CNG’s enterprise approach to tackling fraud has yielded greater benefits. It’s created the foundation for an omnichannel hub to better manage customer relationships across CNG’s brands.

Once limited to new customers, CNG expanded the platform to its returning customers, as well – covering originations, account management, credit risk analyses and more, all in one integrated system in the cloud.

“We send the real-time response to our credit system as well as our back end,” said Cooney. “By using Azure and being able to push that real-time response through into our data lake, I can access that data within moments of an application.”

What’s taking shape across CNG is an enviable example of enterprise decisioning in action – developing a holistic decision-making platform that bridges the entire customer journey.

The strategy is a hot topic in financial services, where institutional decision making and its supporting data and technologies are typically siloed in departments focused on diverse organizational functions. Connecting these functions – whether on a common data framework alone or together with a shared decisioning architecture – streamlines complexities while driving faster, more accurate decisions.

“CNG is creating what many financial institutions dream about – using the same data sources and consistent models and analytics on a single technical architecture,” said SAS’ Bradley. “More than just streamlining its technology footprint and cutting costs, the resulting improvements are helping CNG differentiate customer experience across its diverse brands and offerings.”

Today’s announcement was made during the 34th annual ACFE Global Fraud Conference, convening in Seattle, June 11- 16. Attendees are invited to engage with SAS experts on identity analytics, enterprise decisioning and other fraud and financial crime topics throughout the event at Booth 206.

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CNG's use of identity analytics by SAS is helping the lender improve customer experience across its brands.