figh tin g frau d
Screen shots of the AlixPartners “World Platform” anti-corruption toolset (above and page 43).
during an economic downturn. These
are the sinister schemes one can’t even
imagine are happening because no one
knows to look for them. Once they are
uncovered and observed, their patterns
can be “built into” rules-engines within a
few days or weeks.
Change from Reactive to
Proactive
Fraud prevention efforts are primarily spurred by reactive investigations
and penalties. Few companies truly engage in proactive fraud monitoring. The
majority of thought leadership in proactive monitoring has emerged from the
financial services space. With millions
of dollars (or more) at risk at the click of
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a mouse button, financial services companies have a clear incentive to actively
monitor for fraud. One area that industry is monitoring is “bust-out” fraud, or
first-party fraud in which the thief applies
for a line of credit (credit card, etc.), behaves well, increases the credit line and
then disappears, leaving a large balance
delinquent. This type of scheme is estimated to cost more than $1.5 billion a
year in losses, according to Credit Risk
International.
A recent bust-out fraud cost Southern
California banks at least $15 million. That
scheme involved 15 people, is alleged to
have started in February 2010 and ran
until October 2013. According to the FBI,
it included:
w w w. i n f o r m s . o r g