Bank fraud detections

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Compliance for the Red Flags regulations is just around the corner. Though this is not what is driving banks to increase spending on preventions against fraud in 2008. Acutally about 60% of banks that were surveyed say they are complaint with the rules. Though other compliance demands are the main drives for customer authentication and fraud prevention in 2008.

Though in the last year around 52% of banks experienced attacks against the institution with 22% data being lost due to a stolen mobile device or laptop from and employee which had sensitie customer information stored on it. Some customers computers about 20% had malware on them which stole bank account data. Now theres about 8% who have experienced a breach in the system from and insider who aquired unauthorized access to the banks systems.
The largest concern for a bank is a system breach made by an outsider who aquires unauthorized access into the banks systems, then follows the concern for those who are on the inside who gain unauthorized access to the systems. Then follows breaches made by a third party associate.
Priorities for banks are fraud detection for transfers of money and AML systems and online banking fraud detection.

Around 82% of banks say they already have money transfer fraud detection in place and 6% say they will have it implemented some time with in the next two years. On average the institutions will spend more than $2.5 million on projects in 2008 to prevent fraud. This is 12.5% of the IT budget.

[pennypinch]

I wrote a post a few months back about the Red Flag regulation. Most banks at that time were saying that they were in as much compliance as they could be with the regulation but they said the regulation is so unclear. It tells them what to do but not how to go about doing it. I wonder if anything has been done to resolve the issues.