- Just one in four (27%) financial service and online retail
businesses in EMEA currently employ consortia or fraud
insight exchange initiatives
- Top US card issuer combined digital identity, email and
physical data to boost high-risk transaction detection by a factor
of 23
ATLANTA, Nov. 19,
2024 /PRNewswire/ -- Banks and online retailers can
significantly improve their ability to capture hard-to-detect
high-risk fraudulent transactions through combining shared
fraud intelligence into their risk assessments,
according to the latest Global State of Fraud and
Identity Report from LexisNexis® Risk
Solutions.
Examples include a US bank that boosted its ability to detect
high-risk events by 17 times or 1700% through combining email
address risk with broader digital identity signals, such as device
intelligence and IP address. Similarly, a top US card issuer
combined digital identity, email and physical data, such as postal
address, to boost high-risk transaction detection by a factor of
23.
Currently, only around one in four or 27%1 of
financial services and online retailers in the EMEA region employ
consortia or risk insights exchange initiatives as part of their
fraud prevention technology.
A shared collaborative network enables organizations to flag
suspicious activity relating to device, IP address, email address
and others, to help all members improve their fraud
risk assessments. For instance, a device displaying negative
behaviors poses a five-times greater risk of subsequent
fraud compared to baseline, analysis shows. If
anti-fraud solutions flag a device and email address
relating to a single identity, the fraud risk is eight
times2 greater than baseline. Trusted customers also
benefit from these shared networks, since member organizations can
flag trusted devices to boost recognition of genuine customers,
speeding up login and transaction time.
Such improvements in fraud detection can also
result in significant savings for organizations. Metro Bank, a top
10 UK bank, uncovered over £2.5 million of fraudulent payments
within six months — marking a 105% improvement – using a
collaborative risk insights model to spot outgoing
proceeds-of-fraud payments to mule accounts. The model
also later found one in eight of the accounts flagged during the
period to be mule accounts, helping to protect the bank from the
risk of additional fraud losses and regulatory
fines.
"On their own, email address, digital signals such as device
intelligence and verified identity components can reliably detect
certain aspects of identity manipulation, but when used together,
they become significantly more powerful for assessing application
risk that would otherwise be invisible to banks relying on just
their own view of customers," said Stephen Topliss, vice president of
fraud and identity, LexisNexis Risk Solutions.
"Organizations that share fraud risk
intelligence gain a more comprehensive understanding of fraudulent
activities, which allows them to predict and pre-empt the next
moves of fraudsters," Topliss added. "Sharing
intelligence magnifies insights, revealing connections between
disparate incidents that might otherwise go unnoticed. Moreover, it
streamlines processes by reducing investigation times and allows
humans to focus efforts on the most severe threats, thereby
elevating fraud prevention success rates.
Collaborative networks enable businesses to genuinely understand
the complex, networked inter-relationships between every
transaction, building this into a digital identity over
time."
Another major UK bank increased the value of its
fraud detection by £1.7 million in just one month by
analyzing collaborative email intelligence, including email address
age, domain and composition. Newer email addresses and ones
used to create accounts in a cryptocurrency
marketplace within the past month were also found to carry much
higher risk than others, according to the analysis.
Topliss continued, "As fraudsters network with one
another and develop increasingly sophisticated strategies, no
organization can stand alone in effectively countering their
threats. It takes a network to combat networked fraud.
Collaborative networks that leverage the power of shared knowledge,
risk insights and technology enable organizations to share critical
information about fraud trends and patterns in a safe
and compliant way. This pooling of resources, combining
technological advancements with diverse expertise,
creates a robust defence system that far exceeds the
capabilities of any single entity or organization."
The Global State of Fraud and Identity Report draws
from both the underlying datasets of the LexisNexis® True Cost of
Fraud™ Study and the LexisNexis® Risk Solutions
Cybercrime Report 2023.
About LexisNexis Risk Solutions
LexisNexis® Risk
Solutions harnesses the power of data, sophisticated analytics
platforms and technology solutions to provide insights that help
businesses across multiple industries and governmental entities
reduce risk and improve decisions to benefit people around the
globe. Headquartered in metro Atlanta,
Georgia, we have offices throughout the world and are part
of RELX (LSE: REL/NYSE: RELX), a global provider of
information-based analytics and decision tools for professional and
business customers. For more information, please visit LexisNexis
Risk Solutions and RELX.
Media Contact: Mike
Normansell | Mike.normansell@lexisnexisrisk.com |
07743899948
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SOURCE LexisNexis Risk Solutions