Two years of skyrocketing fraud have forced defenders to boost the use of analytics and anti-fraud technology to regain credibility.
In a survey of 900 members of the Association of Certified Fraud Examiners (ACFE) worldwide, it has been found that the surge in global fraud incited by the COVID-19 pandemic has actually boosted the use of advanced technology to contain the crime.
Faced with a seemingly endless onslaught of schemes and scams, anti-fraud pros have doubled down on data analytics; physical and behavioral biometrics; computer vision analysis; robotic process automation; blockchain; and virtual and augmented reality and other anti-fraud technologies for their work.
Survey respondents of the biennial global research initiative came from 23 industries: most prevalently government and public administration (22%) and banking and financial services (20%). Employers ranged in size from less than 100 employees to more than 10,000 located throughout the world.
Some pertinent findings
More than 40% of respondents reported accelerating their use of data analytics significantly (14%) or slightly (29%) amid the pandemic. Also:
- 60% expected their anti-fraud tech budgets to grow over the next two years
- 26% of respondents chose advanced analytics, AI and ML as their top investment preference; predictive analytics/modeling was the top preference for 22% of the respondents
- 99% indicated that data analytics was beneficial in helping them boost the volume of transactions reviewed or suspected fraud cases identified; 98% indicated that the same technology improved the timeliness of their anomaly detection; the percentages of respondents citing improvements in efficiency in automating ‘time-consuming tasks’ and their ‘overall accuracy in reducing false-positive rates’ were 98 and 97% respectively
- 80% of respondents indicated that ‘internal structured data sources’ remained the crux of most organizations’ anti-fraud analytics initiatives. Many also tapped an external data sources including public records (41%); law enforcement or government watch lists (31%); social media (29%); other third-party data (25%); and data from connected devices (25%)
- 34% of respondents reported that they contributed to data-sharing consortiums, and another 24% that did not contribute, were willing to do so in the future
- 7% of respondents used virtual/augmented reality; 34% used physical biometrics
- Among respondents from organizations not using a particular emerging anti-fraud technology, 13% expected to use virtual/augmented reality, 19% to use RPA—within the next one to two years
According to the ACFE’s President and CEO Bruce Dorris, which commissioned the survey: “To stay ahead of not only the increased volume of fraud instances, but also emerging trends, it’s critical for organizations to be flexible and proactive in adopting new anti-fraud tools and processes. This report serves as a valuable resource for anti-fraud professionals to learn what types of technology their peers are using, or plan to use, and how these technologies have impacted the success of their fraud prevention and detection initiatives.”
The association’s Director of Research, Andi McNeal, noted: “Time-tested techniques like exception reporting and anomaly detection remain mainstays (but) over the next two years organizations aren’t resting on their laurels. The landscape could look quite different when we resurvey in 2023.”
Said Stu Bradley, Senior Vice President of Fraud and Security Intelligence, SAS, a co-partner of the survey: “Even as proliferating online and digital channels have heightened risks and created lucrative new avenues for criminal exploitation, these channels allow organizations to capture droves of data that can be integrated to better monitor trends and, ultimately, take a more preventive stance against rapidly shifting threats.”