August 14, 2018
North America Bracing for Flood…of Fraud
Posted August 5, 2015
Report Finds Banks with Assets of $50B+ Bumping Up IT Security to Meet Expected Shift in Fraud to Mobile and Online after EMV Chip Adoption
There’s the good news. And then there’s the bad news. Which would you like first? How about we give you both at the same time? EMV chip adoption is coming in October. Conventional wisdom has it that it’s good news because point-of-sale (PoS) fraud will be dramatically slashed. Conventional wisdom also has it that it’s bad news because cybercriminals will turn from PoS fraud to mobile and online fraud.
A new Aite Group report says American and Canadian banks agree with conventional wisdom’s assessment because they’re increasing IT budgets, some growing by 20 percent.
In her article on bankinfosecurity.com, Tracy Kitten highlights key issues in the Aite report, “Digital-Channel Fraud Mitigation: The Mobile Force Awakens,” written by Aite’s research director, Julie Conroy, who surveyed 19 Canadian and American banks with assets in excess of $50 billion. The following has been excerpted from Kitten’s story and edited to fit our format. You may find her complete article by clicking on this link.
ThreatMetrix’s own Andreas Baumhof, chief technology officer, in a previous blog, provided counsel on how businesses could ramp up security in advance of the EMV chip deadline.
Canada’s EMV adoption resulted in mobile and online losses doubling
One of the Canadian banks Conroy interviewed for the report told her that once Canada migrated to EMV chip technology, it saw mobile and online account takeover losses double over the course of two to three years.
Banks investing in online/mobile security
Banks are making bigger investments in online and mobile fraud prevention even though fraud in these arenas is currently low, Conroy explains. “The majority of banks that I interviewed either said that their losses are flat or are down. But nobody expects this happy state to continue.”
Automated Clearing House (ACH) payments a target
Banks anticipate that faster ACH payments could also create new risks of fraud, Conroy says. “ACH is absolutely a target in the online channel already. As we see same-day settlement coming to ACH, that will shorten banks’ window to address fraud. So banks are already planning to have to deploy additional types of technologies, such as behavioral analytics, things like that, to help them find the fraud faster. Those settlement windows are going to shrink.”