A Tale of Two Banks (A True Story)

We hear often from our bank and credit union clients about the account takeover and fraud they’ve stopped using our ACH ODFI & RDFI Fraud Detection solution.  Normally the movie plays out roughly the same: fraudster meets bank account, fraudster likes bank account, our ACH ODFI & RDFI Fraud Detection solution detects the fraudster’s suspicious or anomalous activity, FI looks like a hero to their account holder, fraudster goes home with no money.

Recently we heard a tale from one of our customers with an interesting twist. At Guardian Analytics we are passionate about the concept of great security AND a great account holder experience.  The plot twist in this fraud story highlights how the right protections can create the right customer experience that builds trust and loyalty. And lack of the right protections creates, well, something very different.
The movie begins with one of our customers, Bank A, a mid-sized bank using ACH ODFI & RDFI Fraud Detection solution that proactively detected suspicious activity in an account.  Guardian Analytics’ fraud detection alerted the bank to unusual behavior before any sort of transaction was initiated.

Based on the suspicious behavior, the bank called the account holder to inquire about the activities.  The account holder confirmed that they had not logged in to their account at that time or from that location. He was thrilled that the bank was proactively looking out for his safety and was able to catch this before any money was moved.

Now for the twist: while they were on the phone discussing next steps, the account holder realized that if his account at Bank A had been compromised, it was likely his account at Bank B had been compromised as well.

He logs into his account at Bank B, a much larger national bank, and discovers that a very large wire transfer had been initiated through his account and released by the bank. He had to make “the call” that far too many banks receive – according to a survey done by ISMG – 76% of FIs find out about fraud from their customers.

One client, two banks. One happy ending, one nightmare.  The FFIEC got it right. In their new Guidance for online banking security, they call for all banks to have anomaly detection as the foundational component of their security strategy.  This account holder’s money was clearly safer in the bank with sophisticated anomaly detection looking for signs of suspicious activity before money leaves the bank.  Powerful protections and a great customer experience can and do co-exist.
Which movie would you star in? The fairy tale? Or the horror story?