LenderHub

In times of national emergency or market disruption, scammers capitalize on public fear to take advantage of vulnerable consumers. FinCEN and many other organizations have issued warnings and red flags to help financial institutions and their customers identify and stop potential scams, including:

These days, criminals have turned to internet-based transaction laundering to disguise profits from unscrupulous and illegal enterprises. Transaction laundering has also been referred to as factoring, undisclosed aggregation, and electronic money laundering, and it occurs when an undisclosed online business uses another company’s payment credentials to process unknown transactions on behalf of the undisclosed business.

It seems that rarely a day goes by that we don’t catch wind of a case of identity theft. According to an estimate by the FTC¹, around nine million Americans’ identities are stolen each year. And with so much jargon like skimming, fraud, and phishing, it’s not surprising that many consumers don’t know what to look out for. With fraudsters developing new schemes every day, the fraudulent use of identities to establish credit and banking accounts promises to challenge consumers and financial institutions alike for years to come.

We hear a lot about EMV technology these days. In the U.S. alone, 13,000 U.S. financial institutions issue EMV-enabled cards and 450 million EMV cards were in use as of last year. EMV technology—which stands for Europay, Mastercard, Visa, the developers of the chip technology—was created to help reduce card fraud, which was a growing threat every year.

Cybersecurity risk management is complicated. Threats, both known and unknown, are omnipresent. We are compelled to evaluate the likelihood of a threat exploiting a vulnerability in our organization and the possible impact the threat may have on our operations. When vulnerabilities are disclosed, leaders must act to lower their risk and ensure any residual risk is accepted at the appropriate level. In many cases, we may see the proverbial bullet coming and should not wait until it strikes us. Leaders may help address this risk by leveraging threat intelligence, enforcing patch management, and managing third-party risk.

IT security is making headlines more frequently as cyber attacks increase around the world. More companies are being targeted, and it’s becoming more and more profitable for the criminal organizations behind the attacks. I sat down with Jeffrey Julig, Chief Information Security Officer at SWBC, to get answers about what we all need to know and how we can protect ourselves.

We all know that any process involving humans is subject to human mistakes. When your staff works with and processes credit and debit card payments, as many employees in financial institutions do, there's room for human error—in addition to intentional fraud—in the event that employees mishandle card data with no ill intent. However, these careless actions are data security violations, which can lead to fraud and improper charges to your customers' accounts.

It's an unfortunate fact of life that as we proceed through our days and focus on our to-do list, we may get so engrossed in our work that we miss other items that need our attention. Also, unfortunately, in the financial institution world, missing the importance of a transaction or two can cost our businesses big money.

When it comes to finding ways to move money, opportunists are nothing if not inventive, continually devising new ways to infiltrate accounts and bring financial benefits to the perpetrators. As you update your practices and payment methods, individuals move just as quickly to adopt new ways to exploit those new opportunities. To stop these activities and retain the streams of money pilfered from our systems and account holders, we must be militant—not only when it comes to our own side of the loan and payment process—but watchful on our many partners' and vendors' sides as well.

Many of the lenders we partner with often feel like there's a never-ending list of regulatory and compliance requirements to meet. However, if you're lending, you're most likely accepting borrower payments, and you need to be informed about the intricacies of PCI DSS, or the Payment Card Industry Data Security Standard.

Everyone knows that fraud, in all its forms, is expensive. According to the Association of Certified Fraud Examiners, the typical organization loses 5% of its revenue any given year to fraud. Assuming you don't want to hand over 5% of your financial institution's revenue to fraudsters each year, here are some tips to tighten your electronic controls and prevent cyber attacks, which affect the majority of companies on a daily or weekly basis.