Neustar research points out banks are more vulnerable to fraud than a year ago

Friday 28 September 2018 00:58 CET | News

A Neustar research has pointed out that banks are more vulnerable to fraud than they were a year ago.

According to the Account Takeover and Origination Fraud report, a major concern uncovered in the responses shows that financial institutions are relying heavily on multifactor authentication (MFA) and knowledge-based authentication (KBA): 48% of all respondents note that MFA is the strongest security measure. KBA follows in third place after MFA and biometrics.

Lenders are fearful about call center weaknesses and in particular about the danger of criminals impersonating customers or potential customers with the help of tactics like SIM card swap, porting or call forwarding. For example, 68% of managers at credit unions say they are very or somewhat concerned about call center fraud caused by phone spoofing.

A bleak picture emerges for any customer dealing with fraud, as executives estimate that it takes multiple days to investigate identity fraud incidents on average. About 62% of executives say reducing customer inconvenience is a high priority when thinking about bolstering fraud protection. More than 30% of credit unions say it is a very high priority, compared with about 20% of banks and nonbank lenders.

Lenders consider the frictionless use of powerful identity data as among the most important elements of an anti-fraud system, but report significant shortfalls in the adequacy of their current techniques. For example, about 66% say that device fingerprinting is important when considering an anti-fraud solution, but just 51% say their existing device fingerprinting capacities are effective.

SourceMedia Research, an affiliate of American Banker, conducted the survey online in June and July of 2018. Respondents include 282 bank executives, 154 credit union executives, and 70 executives at nonbank lenders.

Free Headlines in your E-mail

Every day we send out a free e-mail with the most important headlines of the last 24 hours.

Subscribe now

Keywords: Neustar, authentication, report, survey, account takeover, banking fraud, American Banker
Countries: World