FICO Research Highlights Challenges for Fraud and Financial Crime Teams Amidst Pandemic

Rhea-AI Summary

FICO, a global analytics software provider, released new research detailing the challenges fraud and financial crime teams in North America faced during the COVID-19 pandemic. The survey found that 68% of senior executives noted remote work significantly hampered effective fraud prevention. Additionally, 70% reported increased fraud attacks impacting operations. Key challenges included obtaining skilled staff (38%), resource insufficiency (36%), and operational inefficiencies (46%). The findings stress a need for flexibility and improved tools to combat financial crime.

Positive

• Increased awareness among executives about the need for advanced fraud prevention tools.
• Demand for flexibility and centralized decisioning indicates potential for FICO's solutions.

Negative

• 68% of executives reported that remote work severely impacted fraud prevention capabilities.
• 70% cited increased fraud attacks, indicating heightened operational pressure.

SAN JOSE, Calif., April 1, 2021 /PRNewswire/ -- Global analytics software provider, FICO, today released new research that highlights the key challenges North American fraud and financial crime teams faced amidst the COVID-19 pandemic. The majority of senior executives (68 percent) said that remote working had a major impact on maintaining effective fraud and financial crime prevention functions within their organizations, during the past 12 months.

The survey, conducted by independent research firm OMDIA, found that over a third of respondents (38 percent) said COVID-19 lockdowns were a main operational challenge.  For instance, managing collaboration between anti-financial crime functions and enabling productivity of staff working completely from home during the pandemic. Especially, as fraud and financial crime departments experienced increased levels of fraud attacks – with almost three-quarters (70 percent) saying the increased fraud attacks had a major impact on their operations.

Additional operational challenges impacting fraud protection functions included: 

• Obtaining skilled and experienced staff (38 percent)
• Insufficient Resources (36 percent)
• Customer experience impact of anti-financial crime activities (45 percent)
• Use of multiple systems across operational processes (46 percent)

"The pandemic put stress on numerous industries and functions, including fraud and financial crime, as fraudsters tried to take advantage of new opportunities and changing customer behavior," said TJ Horan, vice president of product management, at FICO.  "As we come to the one-year mark for COVID-19 measures such as remote workforces, these findings illustrate how teams managing fraud are demanding flexibility, centralized decisioning, automation, as well as an integrated platform to drive effectiveness.  It is encouraging to see how today's teams are rapidly evolving to handle the fight against financial crime."

Throughout the pandemic, one of the biggest demands on fraud and financial crime operations has been the ability to quickly adjust.  Senior executives identified a few key areas that they look to continue to improve.  For instance, the need for institutions to better identify emerging financial crime challenges (54 percent).  Gaining the ability to see full customer-level view when investigating alerts (43 percent).  Also 38 percent noted the need to increase the speed in responding to evolving threats.  Lastly, 64 percent stated a continued effort to enable work from home staff.

For more details regarding the survey results, join the upcoming keynote session during the FICO Virtual Event session, Fraud and Financial Crime: The Covid-19 Impact.

This survey consisted of 110 interviews with senior executives driving, managing, or directly supporting financial crime functions at financial institutions in the U.S., Canada, UK, Brazil, Germany, and the Nordics. The survey included senior executives responsible for fraud management, financial crime compliance, and security and technology. Respondents included executives from both medium-sized and large financial institutions.

For full survey results, view the report.

Read the FICO Blog to help prepare for another critical fraud event.

For more information on FICO fraud and financial crime solutions, visit www.fico.com/en/solutions/fraud-protection-and-compliance.  

About FICO
FICO (NYSE: FICO) powers decisions that help people and businesses around the world prosper. Founded in 1956 and based in Silicon Valley, the company is a pioneer in the use of predictive analytics and data science to improve operational decisions. FICO holds more than 195 US and foreign patents on technologies that increase profitability, customer satisfaction and growth for businesses in financial services, telecommunications, health care, retail and many other industries. Using FICO solutions, businesses in more than 120 countries do everything from protecting 2.6 billion payment cards from fraud, to helping people get credit, to ensuring that millions of airplanes and rental cars are in the right place at the right time.

Learn more at http://www.fico.com

Join the conversation at https://twitter.com/fico & http://www.fico.com/en/blogs/

FICO is a registered trademark of Fair Isaac Corporation in the US and other countries.

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SOURCE FICO

FAQ

What challenges did FICO identify for fraud teams during COVID-19?

FICO's research highlighted significant challenges including remote work impairing fraud prevention (68%), increased fraud attacks (70%), and operational inefficiencies.

What percentage of executives faced challenges due to COVID-19 lockdowns according to FICO?

38% of senior executives indicated that COVID-19 lockdowns posed major operational challenges for their teams.

How did remote work affect fraud operations according to FICO's findings?

68% of executives stated that remote work significantly impacted their ability to prevent fraud effectively.

What are the key areas for improvement identified by FICO's research?

Executives noted the need for better identification of emerging financial crime (54%) and faster response to evolving threats (38%).

What was the methodology of FICO's research on fraud and financial crime?

The survey involved 110 interviews with senior executives managing financial crime functions at various financial institutions across multiple countries.