Fraud & Security Enterprise Fraud Award-Winner Speaks at FICO World

FICO World 2014 logo
Oct202014

Taking an holistic stance when trying to defend against fraud has long been the aspiration of banks keen to minimize loss, improve operational efficiency, and to preserve customer service. But an enterprise-wide approach eludes many, especially those grappling with legacy systems, disparate customer records and multiple stakeholders needed to effect the necessary change. At FICO World next month you can hear from a senior stakeholder from Garanti Bank about their success in enterprise fraud management. Garanti is known as an innovative and progressive banking organization that has grown to be the second largest in Turkey’s vibrant financial services market. You’ll hear about Garanti’s creation and implementation of an enterprise strategy, and their choice of the FICO Falcon Platform to connect their defenses. Their system protects on-boarding for credit cards and consumer loans as well as transactional management for credit and debit cards and current accounts. Garanti’s success in this endeavor... [Read More]

Leave a comment

Risk & Compliance Banker Survey: Wealth Gap Poses Growing Risk

risk-meter
Oct202014

In our latest quarterly survey of North American bank risk managers, we asked about the widening wealth gap. I was a bit surprised by the intensity of the response. More than six in ten (62%) respondents agreed “the wealth gap poses a growing risk to the financial system.” Only 14% of respondents disagreed. I think this is a case of bank risk managers putting on their “ordinary citizen” caps. This issue has received a great deal of attention lately, and we are all becoming more attuned to it. Bank risk managers notice when the pool of people who are thriving is squeezed. They are acutely aware of the long-term implications of this trend for an economy that is driven by consumer activity. However, despite the concern about the wealth gap, there was some positive news in our survey results. For the first time in four years, a sizeable majority (59%)... [Read More]

Leave a comment

Risk & Compliance President Obama Encourages Consumers to Check FICO Scores

Whitehouse
Oct172014

President Obama signed an Executive Order today intended to improve the security of consumer financial transactions. In related remarks, he recognized the importance of consumers checking their FICO Scores regularly. Not only can doing so help consumers manage their financial health, it can help people protect themselves from financial crime. The President explained that “a sudden drop in your credit rating is one of the clearest signs that you’ve been hit by fraud.” With FICO CEO Will Lansing in attendance, President Obama went on to praise Citi as the latest bank to join FICO Score Open Access, noting that “Citi is joining other financial institutions in making free FICO Scores available to customers.” FICO® Score Open Access was launched in November 2013 with participating financial institutions offering free FICO Scores to eight million eligible credit card account holders. By early 2015, that number will exceed 60 million. And the program... [Read More]

Leave a comment

Fraud & Security Three Opportunities Among Fraud Threats

Beseiged businessman
Oct162014

As my colleague Brian noted in his last post, our EMEA Fraud Forum last week generated interesting discussions among fraud leaders from several of the region’s top banks. Three things stood out for me — all of them presenting opportunities to financial institutions. First, what we think of as “fraud” is increasingly bleeding over into the area of cyber security. In light of recent data breaches, financial services providers need to step up and become the preferred guardian of consumers’ data, not just their money. Second, there is an opportunity to involve consumers in identifying and protecting against fraud. This is critical, as banks have to balance better fraud protection with an improved consumer experience. In some cases, proposed legislation might even require consumer opt-in to enable certain anti-fraud programs. Third, fraud is a moment of truth for consumers. How you handle fraud when it occurs can be a point... [Read More]

Leave a comment

Analytics & Optimization FICO World Webinar: Text Analytics 101

Text Analytics 101
Oct152014

Buried in your notes, documents, email, survey results and social media is a gold mine of useful data – but finding that value is hard, real hard. In a FICO World Preview webinar, titled “Text Analytics-What It Can Do for You,” FICO’s Colette Glaser walks through how you can take advantage of the 85 percent of your data that isn’t used because it’s unstructured. Unstructured data is intended for human consumption, not for machine consumption. It is messy, filled with noise and misspellings, and reflective of highly specialized domain and language needs. The growing field of text analytics is introducing new technologies and methodologies to tackle these challenges and get to the heart of your unstructured data. We invite you to listen to the replay of this FICO World Preview webinar as an excellent primer to text analytics. And if you are interested in learning more, you can attend Colette’s... [Read More]

Leave a comment

Risk & Compliance Credit Research Part 2: The Recession and Homeownership

Risk_Housing image 2
Oct142014

In my last post, I examined the increase in mortgage charge-offs during the Great Recession, and how those rates have mostly returned to pre-recession levels. In this post, I’ll share new research on a key consequence of those increased rates—namely, its impact on homeownership. As you might expect, fewer consumers have mortgages now than before the recession, and the rate at which new mortgages are being opened is still far below what we saw in the boom before the crisis. In our study, we compared performance across six Metropolitan Statistical Areas (MSAs): New York, San Francisco and Washington DC as examples of areas that endured the recession relatively well, and Las Vegas, Miami and Phoenix as areas that were harder hit by the recession. The following table shows that the percentage of consumers with at least one mortgage (balance greater than $0) has declined for all six MSAs. This is... [Read More]

Leave a comment

Risk & Compliance Why Consumer Knowledge of Financial Rights Matters

Rights
Oct142014

We recently conducted a survey of 1,000 consumers to understand their relationship with their primary bank, and what makes them loyal and engaged. We hid a 12-question quiz on consumer financial rights in the survey—and unfortunately many respondents didn’t fare well. Only 30 percent of consumers got a passing grade. We also found evidence of what banks have long understood: There is a correlation between financial literacy and better customer engagement. A financially literate consumer, for instance, is more likely to use bank services and less likely to switch banks. In fact, we found that consumers who answered nearly 50 percent of the questions correctly were more satisfied and engaged with their primary banks than those who did not. Consumers who were most satisfied with their banks answered on average 47 percent of the questions correctly, and consumers who were most engaged with their banks answered 50 percent correctly. In... [Read More]

Leave a comment

Collections & Recovery Straight Talk on Effective Collection Practices at FICO World

FICO World 2014 logo
Oct142014

Guest blogger: Anthony Travagline, FICO When’s the last time you heard from seasoned professionals at major European banks who really “walk the walk” when it comes to outstanding collections and recovery? There’s an opportunity to do exactly this at FICO World next month. Until recently, I headed Nordic collections for EnterCard, and now I have joined the collections team at FICO. I’ll be joined for my presentation at FICO World by Robert Pikula, Head of Recovery and Asset Restructuring at Bank Zachodni WBK SA, part of the Santander Group. In our panel presentation, “Collection Platform Success in a Transitioning Economy,” we’ll talk about collection success in the midst of changing consumer behaviors, the role a highly automated, end-to-end process plays, controlling losses through responsible lending and responding to evolving, rigid compliance standards. Both Robert and I have implemented strategies coupled with technology to meet the challenges faced by financial institutions... [Read More]

Leave a comment

Fraud & Security Consumer Tech – Friend AND Foe in the Fight Against Fraud

Tackling Fraud-thumb
Oct132014

European card fraud losses in a post-mature chip and PIN environment reached a new high last year. With this sobering fact as backdrop, several of the EMEA banking industry’s top fraud and risk management leaders converged in London last week at the EMEA Fraud Forum, hosted by FICO. Following presentations by Andrew Churchill, advisor on cyber security issues to both UK and EU government, and Andras Cser, principal analyst at Forrester, the discussions focused on remote channel payment and associated on-line security, plus emerging best practices for keeping customers safe while improving customer engagement and service. One interesting observation: Fraud is, paradoxically, helping banks regain consumers’ trust. Many customers see their banks as being more proactive in the acquisition, use and interpretation of their credentials, and characteristics. They believe, and expect, that banks are at the forefront of protecting and preserving their personal and payment data. But there were some... [Read More]

Leave a comment

Analytics & Optimization Is Big Data a Big Problem for Analytic Models?

Big Problems
Oct092014

In today’s battle for organizations to turn Big Data into faster, smarter and more compliant decisions, a simple statistic tells the story of why this isn’t so easy. It is estimated that most businesses are only able to derive real value from approximately 12% of the data available to them (source: Forrester Research). A lot of effort is being put into combing through the immense variety and volume of data sources and types to separate the “wheat from the chaff” – or what data is noise, vs. what can drive analytic insights and actions. For banks and other institutions, the problem of Big Data adds to an already precarious balancing act between getting more analytic models into production to address a widening spectrum of business challenges, and ensuring these models retain sharpness over time. Even if an organization solves the daunting challenge of finding the occasional needle in the Big... [Read More]

Leave a comment