Financial crime control is a chief priority for most financial institutions around the world, as they continuously evaluate the best ways to safeguard their systems, their data and, ultimately, their clients. Indeed, fraud and cyber security are on the formal management committee agendas at least quarterly for 80 percent of institutions, according to our recent financial fraud survey.
Our survey of 500 banking and financial markets executives whose responsibilities include fraud prevention was conducted as part of the IBM 2015 Fraud in Financial Institutions Study. Our efforts to identify current capabilities, successes, challenges and best practices in controlling financial crime also included interviews with senior fraud executives from financial institutions and related trade associations around the world. (For more information about the research, see the Study approach and methodology section)
Underscoring the challenges today’s institutions face in fighting financial crimes, only 56 percent of the executives we surveyed believe their organizations are in reasonable control of fraud threats. And a significant number believe their fraud operations organizations are in need of a substantial overhaul.
Many of the largest institutions, those with total assets greater than USD 300 billion, have transformed or are in the process of transforming their fraud operations. These organizations were successful in developing compelling, multi-factored business cases that emphasize not only the potential to stem direct fraud losses, but also to lower operating costs and – even more important – better engage customers. All of the largest institutions indicated that they were at least in control of the fraud situation, with 52 percent designating their capabilities as a competitive differentiator.
Check out the IBM study on how the most effective financial institutions are outthinking the bad guys.