Home » 5 Strategies to Boost Ongoing Fraud Prevention 

5 Strategies to Boost Ongoing Fraud Prevention 

by M Asim

Fraud has been growing tremendously in the past few years. In today’s digital age where a lot of transactions are reliant on digital systems, ongoing fraud prevention has become undeniable. 

Fraud is defined as any deception which is practiced for monetary gains. Financial fraud thereby is an extension that uses deceptive methods for financial gain which has become more prevalent than ever now. Manual fraud prevention and detection process such as manual investigations, document verification, and risk analysis are not only time-consuming but are also costly when it comes to training employees or keeping resources 

Quite recently money related fraud and money laundering have become quite prevalent in our ecosystem. Every year millions of dollars are lost to fraudulent schemes.

Consider the case of Bill Hwang, whose private investment firm collapsed after resulting in a $10 billion loss for banks. He was accused of lying to banks to increase credit lines and manipulate stock prices. The case is set to begin its trials in February 2024. 

Despite several ongoing efforts to combat financial fraud, cases like these are never-ending. While manual fraud prevention has failed to comply with the growing demand for security, here are the top 5 strategies for ongoing fraud prevention in 2024. 

How is Ongoing Fraud Prevention Different?

As per the analysis in 2014, it takes 18 months for companies to detect fraud, thus resulting in damage greater than they could expect. Close your eyes and picture for a moment the amount of damages, this delay in identification might pose to your business. 

Ongoing fraud prevention helps manage the delay by keeping a consistent watchful eye for existing and upcoming fraud risks. Equipping an AML screening software with ongoing screening capability can efficiently improve fraud prevention. 

Top 5 Efficient Ongoing Fraud Prevention Strategies

The significant discussion on fraud prevention, ongoing frequency of fraud cases, and urgency to maintain a transparent ecosystem mandate the need to conduct ongoing fraud prevention as an important part of their ongoing AML screening

  1. Ongoing Monitoring of Customers 

Be it any financial institution, ongoing monitoring enables insight into every aspect of the customer lifecycle so no risky event goes unnoticed. Particularly when it comes to risky transactions ongoing monitoring helps generate an alert as soon as the transfer amount surpasses the set threshold against a person. Moreover, organizations can customize the process by either setting the frequency of ongoing monitoring or by assigning a risk score to each individual so that anytime the risk score surpasses the threshold, an alert can be generated for prompt risk detection. 

  1. Customer Due Diligence on Selected Customers 

Ongoing monitoring may be fruitful but overscreening should be avoided to maintain the efficiency of the screening system. Organizations can set a custom risk threshold to simplify their screening process. Any user passing that certain threshold at the time of onboarding or during any stage of the customer journey with the organization, an alert can be generated that can facilitate the timely detection of risks that lead to fraud. 

  1. Technological Advancements 

Manual ongoing monitoring, despite being prevalent isn’t as effective in preventing fraud as compared to monitoring powered by AI/ML algorithms. Precise name-matching technology facilitates with overcoming the challenges of handling aliases and duplicate matches with ease and confidence. 

Moreover, ongoing fraud prevention must include entity matching technology for secondary analysis, if any potential customer is linked with an entity that is either risky or sanctioned by regulatory authorities. 

  1. Advanced, Real-Time AML Database 

In any AML Screening, a database is the most important aspect of any type of screening. For most current ongoing fraud prevention, an updated, real-time database has to be in place. 

Gathered from official data sources, and cleaned by in-house researchers, AML Watcher offers the most updated fraud prevention services through a fool-proof database that offers the most relevant insights you need to comply with AML regulations. 

A consolidated AML database helps with the quick monitoring of transactions against multiple sources against pre-set prioritization to make quick yet informed decisions. 

  1. Strong Internal Controls of Organization 

Despite having all controls in place, many organizations still suffer from fraud cases due to inefficient internal controls. Instead of deploying a single compliance officer to oversee the entire monitoring process, segregation must be practiced. 

Designating each individual on a separate job not only reduces work strain but enhances efficiency while serving the entire purpose of ongoing fraud prevention. 

To Sum It Up 

No organization all across the globe is ever safe from fraud. One can only improve their guards and modify the security to protect their business from being used to launder corrupt practices. How does this happen? By upgrading their AML screening process. 

Having discussed the top 5 strategies that help improve the screening process, explore what your business is missing out on to completely seal the loophole facilitating fraud.

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