Collaboration is key to the most effective fraud detection: so says behavioral biometrics firm BioCatch, which has issued a release announcing the launch of the BioCatch Trust Network, “the world’s first inter-bank, behavior-based, financial crime intelligence-sharing network.”
Based on the idea that fraud is easiest to catch when banks are able to collaborate and exchange intelligence in real time, the BioCatch Trust Network enables instantaneous assessment of the trustworthiness of transactions and accounts, so transfers can be halted before any money changes hands.
“Scam payments are nearly always transferred to mule accounts through which scammers launder their profits before withdrawing them,” says BioCatch CEO Gadi Mazor. According to the latest Global State of Fraud Report from LexisNexis Risk Solutions, fewer than 10 percent of mules identified by law enforcement are arrested and fewer than one percent face charges.
Mazor points out that fraudsters and bad actors often swap tactics, strategies, intelligence and technology. “To combat this rampant criminal activity, it’s crucial for sending and receiving banks to collaborate and share intelligence in real time to proactively identify these money mules and halt payments to them.”
Research backs him up: the LexisNexis survey says banks “significantly improve their ability to capture hard-to-detect high-risk fraudulent transactions” when they engage in “collaborative digital identity intelligence.”
Stephen Topliss, vice president of fraud and identity for LexisNexis, says “organizations that share fraud risk intelligence gain a more comprehensive understanding of fraudulent activities, which allows them to predict and pre-empt the next moves of fraudsters.”
Five of Australia’s largest banks on board for network launch
Now launched in Australia, the BioCatch Trust Network boasts five of that country’s largest banks as founding members. BioCatch expects networks serving other countries to go live throughout 2025. As more banks sign on, the intelligence models that evaluate accounts accumulate billions of historical and validated data points, enabling them to offer deeper predictive insights and broader coverage.
BioCatch says its network’s foundational behavioral intelligence engine “ingests country-specific digital session, payment, account, device, IP and geo-location, and non-monetary event signals to holistically evaluate the trustworthiness of every receiving account” before processing payments. It aims to shut down authorized push payment (APP) fraud and social engineering scams that operate partly outside the digital banking session (for example, on social media).
BioCatch quotes Matt O’Neill, a former U.S. Secret Service Deputy Special Agent in Charge of Cyber who now runs 5OH Consulting, says the ability to share actionable data in real time is key to protecting businesses against complex and fast-moving financial crime. “Real-time information sharing enables us to recognize patterns that individual entities may miss, providing a fuller view of criminal activity while protecting sensitive information.”
The BioCatch Trust Network also strengthens user privacy with pseudonymization to protect the identities of retail banking customers at member banks.
Customers who deal with fraud fallout will bail – and tell their friends about it
Stopping fraud is not just a matter of material losses, but also reputational cost. Data from the 2024 Trust Index Report from Telesign suggests that nearly 40 percent of customers will abandon a company after being victimized in a major data breach. “Additionally, one-third of victims (33 percent) actively discourage friends and family from engaging with these brands, while 20 percent take their grievances to social media platforms.”
Christophe Van De Weyer, CEO of Telesign, says “today’s consumer is sending a clear message: protecting their digital identity is central to their willingness to do business with a brand. There is no longer an excuse for companies to not adopt extra security measures, such as multi-factor authentication, as an overwhelming majority of consumers welcome friction to protect against fraud and provide a sense of security.”
Article Topics
behavioral biometrics | BioCatch | biometrics | financial crime | fraud prevention | LexisNexis | TeleSign
