What? I won a trip to Fiji, and I only need to provide my SSN?
Over the years, I’ve been the victim of a credit card data breach, had my information stolen from retailers, and was recently notified that my email address and password were found on the dark web. As you can imagine, it’s been stressful. But I’m not alone.
In 2022, consumers reported losing nearly $3.8 billion to scams, more than doubling the amount reported in 2021.1 In the same year, 71 percent of financial institutions reported a security breach from business email compromises (BEC),2 and 70 percent reported losing over $500,000 to fraud.3
Even though, as consumers, we do our best to make strong passwords, keep our eye out for red flags and monitor our credit reports, much of this is out of our control. Fraudsters are continually finding new ways to defraud both consumers and financial institutions, forcing us all to be in a constant state of digital defense.
Businesses just need stricter policies to prevent fraud, right?
Maybe not. As a consumer, you’ve likely spent long minutes on the phone identifying yourself through an automated system only to have to do the same thing when you finally talk to a human being, and then again, when you’re transferred to another area. Even though you know why they continue to try and identify you, it’s still frustrating.
So as a business, how do you balance fraud prevention and an excellent customer experience? According to McKinsey and Company, organizations need to consider fraud management, customer experience and customer authentication simultaneously, not as individual issues.4
Companies need to consider how they can redesign their internal processes and operating models so that marketing and sales, customer experience, fraud management and compliance teams are all sharing information, operating together and meeting shared objectives. That’s not happening today.5
Additionally, organizations need more sophisticated technology solutions to pull customer information from a variety of databases — public and proprietary — to compare a broader range of data points to identify anomalies and inconsistencies.5
Start the conversation and coordination
No company wants to make headlines for being defrauded and no consumer wants to have to provide every aspect of their personal life to complete a transaction. But we all can agree, more must be done to keep information secure.
Take steps today to start the conversation and seek advice to improve fraud prevention processes. Fraud prevention is a coordinated effort that takes diligence from everyone.