The views and opinions expressed in this article are those of the thought leader as an individual, and are not attributed to CeFPro or any particular organization.
Howard Rawstron, Head of Economic Crime Prevention Oversight, Lloyds Banking Group
To me it’s not necessarily scam tactics that evolve, these continue to rely on the hook to an individual that results in them parting with their money. The subjects that trigger the scams themselves do however continue to evolve. As we saw, for example with Covid and the Russia / Ukraine war, it didn’t take long for social media and other channels to be inundated with what appeared to be genuine adverts / articles. What the criminals appear to be very skilled at is agility and the the ability to pivot at speed. To counter this threat we need to be able to do the same.
In short yes although there are already organisations like Interpol (Global) and Europol (EU wide) that undertake this role in part. There is certainly more to do and the Private Sector has a role in developing a cross boarder solution that could operate between financial institutions when illegal funds transfer has taken place. This in inherently difficult to achieve but we need to get better at ‘following the money’ when criminality has taken place. Perhalps more importantly using global collaboration to prevent fraud in the first place by sharing data and intelligence must also be a priority.
What are some of the challenges with identifying scams conducted through geolocation technology?
Reliance on the accuracy of the data in front of you in making a decision is certainly a challenge. When you look at organised criminality, criminals commonly use ‘location masking’ or ‘location altering’ technology. Using geolocation as a key / primary data point in decisioning is difficult to rely on. The location is therefore one of a number of elements to identify if a scam is taking place that are balanced collectively to make a decision.
Talking specifically about the issue of Passports and Driving Licences there are 2 areas of risk here
i) fraudulently obtained genuine (FOG) documents
ii) fraudulently produced documents (FPD).
For FOG documents the effort can be quite high based on the potential future return once the document is received. In view of government controls the likleyhood is the potential criminality would be identified.
This is very different for FPD. Forgery has been around for centuries and criminals are very adept at creating what could look like a genuine document. The feartures of the document are important (UV light, CHIP etc) however the person who handles the document having an awareness of what the document looks like is also critically important.
Removing the ‘human factor’ is the key here – enabling access to data that government hold such as linking a passport number to a name would be ideal. I think of it a little like Confirmation of Payee but for document validation.
It’s a very good question and an area I feel financial services organisations have got better at. The challenge is more acute in First Party Lending fraud where the criminal and the ‘customer’ are one in the same. There are data sources to help understand if what the ‘customer’ is saying is accurate however there is also the role of the underwriter for example would an application from a school teacher have an income of £200k? For money laundering I would expect transaction monitor systems to have the ability to identify where lending is used to launder funds or suspicious activity reporting where a staff member suspects suspicion.
There are a good few but probably the most impactful are; speed of payments, global reach, insufficient regulation, limitations in data sharing and, agility / pace in the private sector.
You may also be interested in…
Have you made your free account?