Shared intelligence webinar highlights: how fincrime teams can get ahead

Fraudsters are always steps ahead of the finance industry’s defences. Once a scam has been identified, criminals are already executing new schemes that circumvent the countermeasures put in place.

For fincrime teams to keep up, it’s key to understand how fraudsters think and communicate, mirroring tactics such as sharing intelligence to fight back.

Lucky for you, this post is packed with insights on the inner workings of financial crime, taken from Salv and We Fight Fraud’s Think Like a Fraudster webinar. Ester Eggert, Head of Product at Salv, chatted with We Fight Fraud’s CEO Dr Nicola Harding and Chief Innovation Office Tony Sales—who was once dubbed ‘Britain’s Greatest (Ex)Fraudster’.

The trio discussed how criminals think and operate, and what financial institutions can do to get better at combating these creative attacks. The webinar highlights below give you a glimpse of what goes on in the criminal underworld. To get a more detailed understanding of how fraudsters think in order to improve your approach to fraud prevention, the full webinar recording is here.

Criminals have their own KYC processes

Most serious organised criminals have sharp business minds. They also have finely-tuned risk management strategies. “If you met me for the first time and I didn’t know who you were and you just said one word that sounded dodgy, I’d strip you naked to see if you were bugged,” Tony says.

Criminals also have their own KYC protocols to vet people they are doing business with, says Tony. For instance, they might ask an acquaintance if they know somebody to gather more information about them. “[Criminals] have those networks that [they are] plugged into. And the more you go up in the criminal world, the more people you get to know,” says Tony.

Fraudsters collaborate

Fraudsters are often portrayed as lone wolf characters, but there are whole criminal networks that communicate and cooperate. “The information that spreads in the criminal world is like no other,” says Tony, adding that our industry “would love to be as fast as them at spreading information and being able to tap into it instantly.”

Criminals are eager to collaborate, not necessarily to achieve the same goal but for mutual gain. “Criminals have to work together far more often than we expect,” says Nicola. When it comes to large-scale fraud, “there’s a load of cooperation and real-time intelligence sharing that has to happen, otherwise they can’t pull it off,” she adds.

Money motivates: understand the business case for shared intelligence

Criminals collaborate because they are motivated by one thing: money. Financial institutions need to think the same way when it comes to collaborating on financial crime prevention, and this means being clear about the financial benefits. “If you don’t have actual proof on what are the benefits, then it doesn’t get anywhere,” says Ester.

Take Salv’s intelligence sharing platform Bridge, which is already helping banks fight back against the rise in APP fraud. “We emphasise the recoverability of funds and what’s the probability of getting the funds back to the victim,” says Ester.

Criminals aren’t blocked by red tape

Unlike financial institutions, criminals never have to deal with regulatory red tape—they just share the information they need and act on it immediately. As we all know, that’s not the case on the industry side. And data protection laws can deter financial institutions from wanting to share data. Despite this, as Nicola says on the webinar: “The more we collaborate together, the stronger we become.”

To overcome this, Ester says, firms need to think less about sharing data and instead think about exchanging crime-fighting intelligence only.

“The good part when it comes to intelligence sharing is the limitations are not so strict,” says Ester. This means being more open about the red flags that firms are seeing—not disclosing a firm’s vulnerabilities or any customer information, but giving people a steer on what to be vigilant for. From a compliance perspective, intelligence sharing is much more straightforward than broader data sharing. That’s why there’s no GDPR or banking secrecy obligations with Salv Bridge; because the focus is solely on suspected fraud cases and not customer data.

Crime doesn’t care about borders

Some European countries have historically been very reluctant to share intelligence, putting them at a disadvantage to collaborative transnational criminal networks. “I’ve had these conversations in some regions where they say it would be really difficult to do fraud here—I say, well, the fraudsters don’t have to be there,” says Tony. Attitudes are slowing starting to change, however. “If others are doing something, then there’s the question—why are we not doing it? So even countries that maybe a year ago were saying nothing is allowed, are beginning to change their mindset,” Ester says.

To learn more about how fraudsters think and what Salv can do to help, watch the webinar here.