Businesses must take a proactive stance on financial crime


As we all settle into our digital lives, the internet has become not only our place of work, but also a place where we learn, shop and socialize.

So it should come as no surprise that cybercriminals are taking advantage of the present moment. Indeed, it has reached a point where very few people can say that they have not been targeted in one way or another. The Federal Trade Commission has reported that online shopping scams and frauds cost US consumers an estimated $ 1.4 billion in 2020, and it looks like fraud activity hasn’t declined much this year, either. .

“It’s really unprecedented right now,” Todd Raque, Financial Crimes and Anti-Money Laundering Compliance Officer at Featurespace, told PYMNTS in an interview. “As we come out of the pandemic, scams are on the increase, and I think it will continue. “

Same scams, different media

The crooks live up to their old tricks, Raque said. Phishing remains more prevalent than ever and can still find reliable targets.

But he said the increase in online shopping means consumers also run the very real risk of inadvertently buying counterfeit products. He knows this too well because he himself was recently the victim of such a scam. Having just moved to Florida, Raque said he was searching online to buy sunglasses when he came across what appeared to be a steal on a pair of Maui Jim sunglasses.

“I ordered a pair for my wife and I, and it turned out to be a scam website with only one letter when I was billed,” did he declare.

Raque said he considers himself lucky – he only lost the nuances. He warned that many scam websites would try to steal a consumer’s information and exploit it elsewhere in even bigger scams.

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It’s time to get wiser

Asked what can be done to prevent fraud, Raque said educating organizations and consumers should be number one priority. Both people and organizations need to be aware of all the popular scams and schemes that scammers have in their arsenal.

Raque said the financial services and payments industries are particularly vulnerable to fraud. When you remove this human interaction, you lose a key piece of the puzzle. It is therefore more urgent that people know about the red flags. Training is needed so that everyone has the right escalation path in the event of a problem, not only to help the institution but also the clients, he added.

“You have to put yourself in a position where you are proactive and not reactive, and you have to get ahead of the curve,” Raque explained. “Technology is a part of it, but you also need to have a good basic process that relies on identifying emerging risks and typologies. “

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Wider net for the application

Raque said the US Financial Crime Network is currently working on implementing major anti-money laundering (AML) reforms over the next two years, which will likely require some institutions to provide forces to the order of the most useful information about fraud and the scams they face, beyond what enforcement teams are reporting today.

The initiative is to fight financial crime, said Raque. So organizations need to start thinking more about the intersection of fraud and AML and how they can help investigators.

“Institutions, retailers and in particular regulated entities will need to start thinking about the impact this will have and how they can pivot their programs to be more proactive than reactive,” he said. declared.



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