Fraud was a consistent theme in 2017’s headlines, causing significant financial and reputational losses to financial institutions. High impact data breaches plagued credit reporting bureaus, government agencies, and private companies, not only raising concerns around weaknesses in cybersecurity controls but also around fraudulent activity committed with stolen personal data. Meanwhile, fraud schemes such as account takeover and internal fraud have continued to grow over the past year.
In response, financial institutions will need to enhance their authentication techniques – through biometrics or otherwise – to prevent criminals from using compromised data to open new accounts or access existing ones. Additionally, emerging threats such as artificial intelligence-powered attacks as well as new technologies including instant payment services will present a new series of risks. To keep up, financial institutions should reevaluate their operating models to become better aware of the threat landscape and more agile in responding to these new risks. Regulators are also stepping in, with new requirements around data privacy and anti-fraud controls coming into effect this year, and the Financial Industry Regulatory Authority (FINRA) listing fraud first in their 2018 examination priorities
Financial Services Leader, PwC US