As a manager, I always had a nagging feeling that my staff were not as well trained as they needed to be. As a consultant, I hear the same concern from my clients. Most managers know that fraud investigators need training, and lots of it, yet they don’t always have the resources at their disposal to train staff to the level needed.

Not only do investigators need initial training, they also need refresher training, as well as training on emerging threats etc. Great technology without a great investigator training program will result in not so great results. Inadequate or substandard technology will result in gross inefficiencies and ultimately losses. This applies to all loss types, from internal fraud to check fraud, but more on that in a minute…

In addition to a rigorous training program, investigators also need regular feedback, both good and bad, regarding how they are performing. Problems must be identified and addressed quickly before losses result. Best practices or superior knowledge of a particularly complex fraud scheme also needs to be shared with staff quickly and efficiently. There is nothing worse than knowing that a loss could have been avoided if knowledge had been shared within the department.

With all that said, how many companies, (and I am not just talking about banks), invest in cutting edge technology and extensive fraud investigator training? From my experience, not many. Unfortunately, training is one of the first expenses cut when times are tough and last to be added back when the good times return.

Can great technology help compensate for insufficient training? In the short term it can, but in the longer term, certainly not. Once you “educate” or train a fraud detection engine to detect a scheme, place an alert, hold funds, flag an account etc. you don’t have to reaffirm the elements of the fraud scheme on a daily, weekly, or monthly basis. All things being equal, the rule is set and applied with 100% accuracy and consistency. However, let’s not forget that the output needs to be created, monitored and “decisioned” by investigators that know what they are doing! If training is lacking, losses will result, no matter how well the technology performs.

Alternatively, if technology is deficient, then no matter how much training is provided, the investigator will always struggle to make well informed and accurate decisions on a consistent basis. Far too many fraud departments are forced to create a labyrinth of procedures to compensate for inadequate technology. The amount of time and effort spent to compensate for “bad” technology is largely a hidden cost, but certainly is a cost nonetheless.

Please share your thoughts on fraud investigator training. Am I placing too much emphasis on the importance of training?

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