Banks Shift Focus to Integrated Cybersecurity and Fraud Model
As financial institutions face increasingly sophisticated criminal threats, many are abandoning traditional siloed approaches to cybersecurity and fraud prevention in favor of a more integrated model.
Combining Cybersecurity and Fraud Units
By combining their cybersecurity and fraud units, banks can improve threat prediction and detection, reduce duplication of effort and resources, and enhance customer experience. This holistic approach also enables the aggregation of customer information from various sources, allowing for more effective risk scoring and transaction monitoring.
Strategic Prevention: Predicting Risk Instead of Reacting
The key to successful strategic prevention is predicting where threats will appear rather than simply reacting to them. Banks can achieve this by redesigning customer and internal operations based on a continuous assessment of actual cases of fraud, financial crime, and cyberthreats.
Eliminating Silos
By adopting a mind-set that mimics the behavior of criminals, banks can design controls around processes rather than points, improving protection for both themselves and their customers.
Efficiencies of Scale and Processes
The integrated fraud and cyber-risk functions can eliminate duplication of effort and resources, while clarifying roles and responsibilities to ensure no gaps in second-line defense. Consistent methodologies and processes also enable institutions to build a deeper understanding and ownership of risks.
Benefits of Integration
- Eliminate duplication of effort and resources
- Clarify roles and responsibilities
- Ensure no gaps in second-line defense
- Build a deeper understanding and ownership of risks
Data, Automation, and Analytics
Through integration, banks can unlock the full potential of their data, automation, and analytics capabilities. This includes enhancing customer identification and verification, as well as enabling predictive analytics and real-time risk scoring.
Unlocking Potential
- Enhance customer identification and verification
- Enable predictive analytics
- Real-time risk scoring
The Customer Experience and Digital Trust
An integrated approach to fraud risk can also result in an optimized customer experience, with survey after survey affirming that banks are held in high regard for their performance on fraud.
Building Digital Trust
- Foster digital trust through security, convenience, transparency, and control
- Differentiate yourself from competitors
- Build strong relationships with customers
A Holistic View
The ultimate goal of the transformed operating model is a holistic view of the evolving landscape of financial crime. This requires independent oversight and challenge, as well as integration of business, operations, security, and risk teams for efficient intelligence sharing and collaborative responses to threats.
Key Components
- Independent oversight and challenge
- Integration of business, operations, security, and risk teams
- Efficient intelligence sharing and collaborative responses
How to Proceed?
As banks design their journeys toward a unified operating model for financial crime, fraud, and cybersecurity, they must probe questions about:
- Processes and activities
- People and organization
- Data and technology
- Governance
Next Steps
- Integrate your cybersecurity and fraud units
- Achieve greater risk effectiveness and efficiency
- Consider fully unifying your risk functions relating to financial crimes