AFP 2021 Preview – Identity Crises: Best Practices in Fraud Mitigation
- AFP 2021 is coming November 7-11 both virtually and in-person
- Frank D’Amadeo, director of treasury at Con Edison, sees new sophistication in fraudsters
- "We're no longer fighting the so-called 'amateur fraudsters'"
The Association for Financial Professionals -- known by industry professionals by its acronym AFP -- will be hosting its AFP 2021 Annual Conference both in-person at the Washington, D.C. Convention Center and virtually. As a preview to the much-anticipated conference, AFP has posted an interview with speaker Frank D’Amadeo, director of treasury at Con Edison. In the video interview -- hosted by Tom Hunt of AFP -- D’Amadeo previews his session: “Identity Crises: Best Practices in Fraud Mitigation” and highlights some key takeaways that attendees will gain from this discussion.
D'Amadeo noted that fraudsters are upping their game. "In the last few years, not only has fraud been on the rise, but the techniques that bad actors have used have become more impressive." He went on to note that "legacy fraud policies and tools are simply not enough to combat to modern fraudster."
"This is a war, in my opinion, with an invisible enemy, and in some ways I look at treasury as the last line of defense," he says.
The "Corporate Approach"
Far from being run out of back alleys, the new wave of fraudsters are far more "high-end" than we're used to in the past.
"They seem to be taking a corporate approach these days. They're onboarding people with experience in hacking technology, social engineering, finance, banking, and, yes, even in grammatical skills. The stuff we see -- the English -- is now very good, and it's no longer easy to pick out a poorly written email and just assume it's fraud.
"We're no longer fighting the so-called 'amateur fraudsters."
D'Amadeo also says that the decentralized workplace caused by COVID has made individuals and organizations more vulnerable than before. The days of the unsophisticated fraudster sending poorly formatted emails containing numerous grammar mistakes are gone, and more technologically savvy fraudsters and moving in.
Defending Against Sophisticated Fraudsters Requires High-End Tools
When it comes to combatting fraud, it is simply impossible for humans to review each item or case. As the fraudsters continue to evolve and leverage more sophisticated techniques and technologies, so should companies and their financial institutions. While humans are limited as to how many items and cases they are able to analyze, technology is not.
During our recent interview with Forensic Document Examiner Khody Detwiler, Mr. Detwiler compared the similarities between how OrbNet Forensic AI, developed in the OrbNet AI Innovation Lab, and a forensic document examiner look at documents.
There is a lot of commonality between how software operates and how a document examiner looks at documents and signatures … [T]he software and examiner analyze similar features such as spacing, sizing, letter formation, etc.
By leveraging technology, items and cases are initially interrogated and analyzed by the AI technology for any suspicious attributes, flagged by the system, and reviewed by a fraud analyst, creating a more efficient process and reducing the number of items reviewed by humans, while at the same time decreasing the number of false positives.