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When was the last time you reviewed your business’s fraud and financial crime prevention strategy?

Fraud is growing exponentially. And unfortunately, if a transaction has left the building for settlement before it has been thoroughly checked, it’s already too late.

Our research shows that enterprises are losing on average a staggering £400k per annum to fraud, and this is rising every year.

Best practice dictates that 100% of your transactions need to be reviewed before they leave the business, and with the onus moving from banks to businesses, we’ve put together a helpful guide for what threats your business should be looking out for and how to protect against them.

Threat 1: Authorised Push Payment (APP) fraud

UK Finance reported £479m losses due to APP scams in the UK in 2020

This is where businesses can be tricked into sending money to a fraudster posing as a genuine payee. This could be as simple as a fraudster calling claiming to be from your bank and asking you to urgently transfer money into a new account as yours has been compromised.

Best Practice:

Payments should be screened in a way that you have confidence that you have paid the right payee and its reached the intended destination. Should suspicious behaviour be found, contact the vendor directly to verify what is being requested. Carry out bank account ownership checks in real-time, this will verify that the bank account exists and the name on the account matches that of the vendor or individual you’re dealing with.

Threat 3: Insider and Employee Fraud

Over 1 in 2 businesses (57%) have seen an increase in insider fraud in the last 12 months

With more of us working from home due to the pandemic, this has taken us away from our business office environment making it increasingly difficult to monitor or evidence fraudulent activities undertaken by employees.

Best Practice:

Monitor access of employees who are able to make payments. Have stringent approval and reconciliation processes in place in order to record anything out of the ordinary. Deploy a ‘Record & Replay’ solution to record the activity of your internal and external users in the applications you run to investigate suspicious activity.

Threat 2: Business Email Compromise (BEC)

Accounts Payable departments are most vulnerable for BEC fraud, but also support, accounting, vendor management, payroll

Also known as CEO fraud, this is a type of phishing attack where criminals attempt to trick employees into transferring funds or revealing sensitive information. This can be done by impersonating a known contact and making an email or text message appear legitimate and creating urgency in order to redirect payments.

Best Practice:

Be diligent – know your suppliers, customers and educate employees - this needs to be ingrained within the core culture of any business. The easiest way into any business is via email. Check email addresses/links by hovering over the link, to see if it’s a known sender or legitimate domain. Leverage technology to identify suspicious transactions, in real-time and make informed decisions to stop or release payments.

Threat 4: An Ever-Changing Regulatory Landscape

Fines of £199m were handed out for Anti-Money Laundering in the UK in 2020, this is a 26 percent increase from 2019

As part of your fraud prevention strategy, you also need to ensure your business is compliant with money laundering regulations. This not only protects your business from fraudsters but ensures you don’t conduct business with countries that you shouldn’t. Making a payment to a sanctioned country could result in reputational damage, catastrophic fines, deep investigation and possible imprisonment.

Best Practice:

Adopt a risk-based approach to managing customers, suppliers and transactions to protect your business. Review regulatory requirements to ensure your business complies with AMLD6 Utilise technology to screen your payments and payees to ensure you’re doing business with legal entities.

75% of organisations were targets of fraud in 2020 and therefore business must have appropriate measures in place to protect themselves

When it comes to investing in technology for fraud prevention and compliance, it’s natural to ask, what’s the benefit?

Our research shows that enterprises are losing on average £400k per annum to fraud.

Even with insurance policies and the expectation of claiming funds back, there is no evidence to suggest companies are recovering all their losses. This makes it even more important to stop fraud before it takes place.

Working with a trusted partner focused on protecting and securing your payments processes will help you build the best defenses in an increased financial fraud landscape.

Having a cloud native, SaaS based Fraud and Financial Crime solution in place can help:

Prevent risks of making payments to a company or entity that you shouldn’t, saving your business from reputational and financial implications

Reduce overheads of time spent on manually checking payments or investigating internal and employee fraud

Remove friction of disparate systems and how payments and data is managed

Create transparency by being able to easily produce reports whether for internal purposes or for the regulator

BT personnel 153

1 in 4 businesses are being attacked at least once a week

BT data representation 19

On average companies recover only 34% of losses experienced through fraud

BT security fraud & risk 158

43% of companies have cyber insurance cover

We’d love to chat to you about how Bottomline can help but don’t just take our word for it:

"Using a cloud-based payment platform has allowed us to be more flexible in how we make payments and by using the security module it’s allowed us to feel confident in our payments. We can now detect and block fraudulent attempts whilst ensuring the accuracy of our payment data."

Peter Soakell, Finance Director: Barker and Stonehouse.

Here's a snapshot of how Bottomline's SaaS Fraud and Financial Crime Solutions can help:

BT security fraud & risk 160

Secure Payments

Protects payments across a variety of applications, channels and payment types with technology including machine learning and transaction blocking.

BT personnel 145

Insider and Employee Fraud

Quickly detect anomalies and access to determine who is a high-risk employee across your systems.

BT security fraud & risk 162

Account Verification

Checks the bank account ownership and account details to make sure you pay the correct beneficiary.

BT transaction 75

Enterprise Case Management

A single, powerful application that provides an enterprise-wide alert and case management system for creating and managing alerts, cases of suspicious activity and support for Suspicious Activity Report (SAR) filings.

BT documentation & messaging 53

Watchlist Screening

Enables organisations to automatically identify suspicious transactions and stop payments fast and continually protecting business from money laundering gangs and terrorist financing networks.

BT documentation & messaging 39

Authorised and Unauthorised Fraud in the Era of Payment Innovation

Fraud comes in all forms and as criminals continue to become more innovative, banks need to find new ways to combat authorized and unauthorized fraud.

White paper
BT documentation & messaging 39

Fight Fraud and Financial Crime with a 360 Degree View

Most financial institutions' case management tools across their enterprise have not kept pace with the rate of change. Investigators are trying to fight sophisticated criminals with technology and tools that are not fully up to the tasks.

White paper

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