Fraud leaders bet on education and technology to fight the growing fraud threat, new research finds

Nearly two thirds (63%) of businesses believe that a malicious data breach by an employee is a significant threat (up from 41% in 2017), according to Callcredit’s 2018 annual fraud report which is released today.

The study, entitled Building a Fraud Fortress, examines how businesses can protect themselves, their customers and their staff, and finds that fraud leaders are betting on a mix of employee and customer education, alongside advanced technology solutions, to counter the growing threat.

An insider attack is just one of the many possible avenues. There’s also the risk of employees being exploited and customers being scammed, as well as cyber attacks and data breaches. The threats experienced most frequently, according to the report, are against authentication systems (45%), web-based services (43%), and phishing (42%) – demonstrating the breadth of technological and human-based methods that fraudsters are adopting.

The question for businesses is how to fight back and Callcredit’s research illustrated the importance of education, as well as the technology-based solutions which 57% regard as being key to fraud protection.

Nearly half (49%) are already including some specific anti-fraud education as part of all employees’ induction and many have plans to develop training programmes further. 43% of managers aspire to implement live exercises to test how staff respond, and 42% see employee drills having a role in combating fraud.

When it comes to technology, 45% of those surveyed are currently using surveillance and 42% are using URL tracking as preventative measures, whilst nearly half (45%) are looking to deploy artificial intelligence as a preventative tool in the next two years.

John Cannon, Managing Director, Fraud and ID, Callcredit said: “Education and training undoubtedly play an essential role when it comes to preventing fraud so it’s encouraging to see from the research that this is already firmly embedded with nearly half of UK businesses. However, it’s important to adapt and evolve training to keep up with the fraudsters – it can’t simply be a tick-box approach. Live exercises and employee drills are a good idea as it’s important to simulate realistic situations.

“But education is only one piece of the puzzle and businesses should be thinking about the other tools available that can be used to help better protect themselves against fraud. It was interesting to note some of the technologies fraud leaders are looking to use in the next year – ID verification (90%), machine learning (37%) and biometric screening techniques (37%) – as this reaffirms the importance of the balance between more traditional techniques and emerging tools. Whilst businesses need to keep up with the latest developments, these should be enhancing existing verification techniques.”