SECURITY
Tocatchathief Cybercriminals were quick to spot vulnerabilities as millions more transactions were conducted online during the pandemic. So, how should the payments industry respond? We asked Omri Kletter, Global VP for Bottomline’s financial crime and fraud department, and ‘The Ethical Hacker’ Ralph Echemendia As the pandemic continues to create uncertainty across the world, fraudsters have been making the most of what they see as a golden opportunity. Indeed, one study from Javelin Strategy & Research estimated that there has been a 35 per cent rise in global fraud attempts during the outbreak. Financial institutions shouldn’t rely on regulators to help them tackle this onslaught – according to cybersecurity expert Ralph Echemendia, aka ‘The Ethical Hacker’, the law will be years behind the criminals. That doesn’t mean banks and other financial services providers are impotent as the threat level rises. In fact, according to Omri Kletter, global VP for the financial crime and fraud department at business payments technology provider Bottomline, while the pandemic has created a unique opportunity for online crime, it’s also handed companies the best weapon to combat it… data. The rapid global increase in digital payments and online banking has facilitated the collection, sorting and fusing of data into fraud solutions. Armed with this intelligence, smart providers will develop data science teams to unleash its full potential, says Kletter.
Here, Echemendia and Kletter discuss the changing nature of fraud, the importance of people, not just tech, in its prevention, and why data transparency may prove the best way to defeat the problem of cyberfraud. THE PAYTECH MAGAZINE: Has payments modernisation been matched by equal advancements in fraud prevention? RALPH ECHEMENDIA: There’s been a lot more focus on fraud prevention across the entire banking and transactional community. Regulatory compliance has forced the industry to get better at it. When it comes to technology, machine learning is being used more and more for fraud prevention and overall security. So, it certainly has got better and continues to improve. OMRI KLETTER: The bad guys have also advanced dramatically. At Bottomline, we’re seeing singular, or even dual hacking environments, evolve into organised crime. I would even go as far as to say that we are seeing state level [crime]. And that’s a different ballgame. It’s a call to action for us in the industry. If I think about it from a board-level perspective, if I’m a head of payments or technology, I must make sure that my company invests much more in
security because the protection is not against one or two singular hackers – there are much more advanced, serious concerns out there. We talk a lot about technology, but people are also very important to this. Many more financial institutions are saying ‘we need to build this new paradigm of fraud experts in the organisation’ – dedicated data scientists within the bank. TPM: What type of new fraud attempts have come about as a result of the pandemic and the increasing use of digital banking by customers? OK: If there is one thing we’ve learned from this pandemic, as a society, it’s that it’s important to watch what happens in different territories: viruses are without borders, as are fraud and financial crime. So we are working
Fraud tends to follow speed, popularity and confusion. So, it’s almost a play for fraud in the pandemic era
Omri Kletter, Bottomline
Moving target: Fraudsters are too often several steps ahead
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ThePaytechMagazine | Issue 7
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