Feedzai Report Finds Banks Overconfident on Fraud
Banks are more confident in their fraud defenses than the evidence supports, according to a report from fraud-prevention company Feedzai.
A report from fraud-prevention company Feedzai found that banks have greater confidence in their fraud defenses than the findings support.
The report examined how financial institutions assess their ability to prevent fraud. It identified a gap between banks’ confidence in their controls and the fraud risks faced by customers.
Banks may assess their defenses by counting transactions they block. The report also considered scams in which customers are persuaded to approve payments and attacks that use stolen personal information.
Some fraudulent payments can appear legitimate because customers authorize them or because criminals use valid account details. These transactions may not be stopped by controls designed to detect unauthorized activity.
The report focused on how banks measure the performance of their fraud systems. It examined whether institutions include customer reports and confirmed fraud losses in those assessments, alongside blocked transactions.
Feedzai did not state that confidence in fraud defenses means banks have eliminated fraud risks.
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