The Value of Integration and Collaboration

I recently attended part of the Orbograph user group meeting where I participated in a panel discussing the value in combining forces in the fight against fraud. The panel was moderated by Jodi Pratt, well known in fraud-fighting circles. Speaking with me on the panel was Carl Bortol of Data Support Systems. Both Carl and I represent companies that have partnerships with Orbograph. On the panel, we discussed two levels of working together, integration and collaboration.

Integration
This level focuses on integrating the fraud detection system into the rest of the bank’s systems in an operational sense. This includes core systems like DDA and CIS, and transaction processing systems like Exceptions, Teller, ACH, and Wire transfer, and even other fraud detection systems. Integration supports a higher level of efficiency in the fraud detection/prevention effort, and as we move to “real-time” detection in areas like ACH and Wire, it will be a necessity. Integration will also improve our capability to move check fraud detection up to day one and day zero (at the time of the transaction). Carl made an excellent point that banks are reengineering their operational processes, so now is the time to look for that integration with fraud detection systems.

Collaboration
This piece of the partnership focuses on teaming up to apply complementary and synergistic solutions to fraud detection and prevention. The Supplement to the FFIEC Guidance released earlier this year reflects this thinking. The concept of a layered approach encourages collaboration between the front-end systems used to detect access fraud, and the back-end systems used to detect payments fraud. There is an opportunity for these very differently focused solutions to work together to produce a much safer payments mechanism.

A good example of collaboration is how Memento and Orbograph approach check fraud detection. The combined solutions provide two very different ways of looking at the same activity – Memento represents the behavior analysis perspective and Orbograph represents the image analysis perspective. Working together, the two solutions can produce a more effective detection capability, improving the quality of the alerts and reducing false positives - the age-old nemesis of fraud detection efforts.

One point that Jodi Pratt brought up regarding check fraud, which I thought was important to clarify, was to debunk the notion that check fraud is closely correlated with check volumes. The numbers don’t support that conclusion. Check fraud remains high with over 90% of both banks and corporate treasury units reporting fraud experience in the last survey on this topic, even while check volumes continue to decline. Jodi did a great job providing food for thought and setting up the interview portion of the session.

I look forward to the next opportunity to present with Jodi and Carl, and I am looking forward to other collaboration opportunities like the one that the Orbograph-Memento partnership represents. I think this will make a big difference in fighting fraud of all kinds.

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