How to Prevent Fraud
Fortunately, there are steps banks can take to help harden their virtual front doors against this type of attack. First, they can implement robust access control policies that assess the risk of each user session and require the appropriate level of authentication based on that level of risk. For example, a user accessing an account from a new browser in an unusual location can be asked to provide a stronger form of authentication.
Conversely, a user checking an account balance from a known device might not have to authenticate further until later in the session when initiating a funds transfer. With this kind of risk-based access system, banks can keep criminals out without introducing unnecessary hassles for their customers.
Second, banks can deploy fraud protection technology. These solutions leverage research into the latest malware and fraud techniques to help detect fraud patterns through Web and mobile channels in real time. Once fraud is detected, the bank can take action to prevent the losses and reputational damage that result from the activity.
Finally, banks need a way for their antifraud teams to monitor which customers have fallen victim to fraud. With proper monitoring that consolidates inputs from across systems, a bank can alert affected customers and help them take steps to remove the source of the fraudulent activity on their accounts.
Integrating Identity and Access Management Tools
Each of these components adds value individually. However, integration across access control, fraud protection and monitoring solutions unlocks far greater total value. Integration allows the access management system to act as a fraud protection gateway. Indicators of fraudulent activity can be used as context to adjust the risk of a particular user session.
If suspicious activity is detected, a risk-based access management platform can then require stronger authentication — a one-time password, for example — or disable certain functions entirely, such as adding a new payment receiver to the account. At the same time, a monitoring system can integrate information from both the access management and fraud prevention solutions so that fraud analysts can get a complete picture of the user and the suspicious activity before contacting the affected customers.
Written by Brian T. Mulligan