NatWest has strengthened its fraud protection systems by partnering with Vocalink Analytics to create a machine learning solution.
Vocalink Analytics and NatWest have worked together to develop, test and launch Corporate Fraud Insights, which uses AI and machine-learning techniques to identify and flag suspicious non-real time payments. The system is designed to detect and prevent invoice redirection fraud – where businesses are duped into paying money into a fraudster’s account rather than to their intended supplier.
Since introducing the solution last year, the bank claims to have prevented losses of over £7m to customers, with individual attacks often worth hundreds of thousands of pounds.
Gary Kearns, executive vice president for Vocalink Analytics added: “We apply sophisticated analytical techniques to vast amounts of payments data to build models which identify suspicious activity. Every time a business pays an invoice, a behavioural signature is left behind. By analysing these signatures, and the signatures of historical frauds, we are able to identify and flag suspected incidents of fraud.”
Invoice redirection fraud is a growing problem in the B2B marketplace. Vocalink Analytics’ 2017 Small Business Fraud Report showed that the problem of business-related payments fraud is widespread, with 24% of SMEs surveyed saying that fraudsters have attempted invoice fraud against their organisation. The Small Business Fraud Report also found that, where business-related payments fraud has occurred, 23% of businesses lost money with 26% stating that they suffered losses of thousands of pounds while 9% lost millions of pounds.
Lee Fitzgerald, head of fraud for commercial and private banking at NatWest, added: “Detecting Invoice Redirection fraud is akin to finding a needle in a haystack, as there are tens of millions of legitimate non-real time payments every day. While volume of fraud is relatively low, the values are typically large amounts, so the business impact of this type of fraud can be crippling. Corporate Fraud Insights is part of our on-going commitment to fighting payments-related fraud on behalf of our customers, helping businesses to stay safe and secure.”
A Mastercard company, Vocalink designs, builds and operates bank account-based payment systems. Its technologies powers the UK’s real-time payments, settlements and direct debit systems, as well as the UK’s network of over 70,000 ATMs. It works work with clients to help them improve their business performance, enhance operational efficiencies and manage risk and regulatory obligations.
With the problems associated with fraud and money laundering counting to rise, Vocalink’s financial crime solutions overlay payments data with leading-edge data science tools and techniques to protect the legitimate users of payments systems. Its Corporate Fraud Insights solution also identifies and flags suspected fraudulent transactions early in the transactional cycle by applying advanced analytics and behavioral rules to payments data.
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