According to the ABA Deposit Account Fraud Survey, bank's losses from check fraud in 2006 were $969 million, up more than 42 percent over the 2004 survey numbers.
DALLAS (PRWEB) October 15, 2008
The organizations are part of a collaborative effort working together to help banks stop fraud by creating a system that allows multiple vendors' sophisticated ICSFs to be easily validated from any check image through a common set of messages and using a single process. This streamlined solution tangibly demonstrates "interoperability."
"Check fraud is a big problem, and getting bigger fast," said Frank Jaffe, a consultant and project manager leading the collaborative effort on behalf of PaymentsNation. "According to the ABA Deposit Account Fraud Survey, bank's losses from check fraud in 2006 were $969 million, up more than 42 percent over the 2004 survey numbers."
Three factors make the demonstration particularly timely. First, the industry has significantly moved to images, reducing the effectiveness of existing fraud tools. Second, the fraud losses are rising quickly, indicating that the fraudsters have begun to exploit this opportunity. Third, the double whammy of increases in check fraud and decreases in check volume potentially undermines the critical role that check processing plays in contributing to a bank's profitability.
"Given the above factors, the industry needs new tools which it can deploy now to reduce check fraud in a more effective manner," said Karroll Searcy, Chief Operating Officer of PaymentsNation. "Vendors have developed core technologies to address this challenge, and the industry has collaborated to develop standards to allow this technology to provide anti-fraud capabilities far more effective than any ever affordably available before. We're pleased to work with these companies to help the industry understand and adopt better anti-fraud tools."
ICSFs help prevent fraud losses in two ways: by increasing the number of items that can be tested and because they remain fully effective after imaging. Traditional check security features do not generally provide effective fraud protection when only an image is available. ICSFs use cryptographic techniques and a security mark to automatically validate that a check is authentic, unaltered, uncopied, and/or properly authorized. In the case of commercial checks, they are most often printed when the check is issued to protect critical variable information such as the payee name and transaction amount without requiring issue files be sent to the bank.
Security feature interoperability validates that the feature should be and is present, and that the check is not fraudulent. The ICSF framework provides a simple message protocol to exchange validation information. Because the framework is flexible, validation processing can take place at any business entity using any computer or scanner type.
"ICSF interoperability enables a bank to use new check image security features—without limiting options based on other banks' choices," said Jaffe. "Banks can immediately improve check image fraud detection, and sell bank customers better fraud prevention and protection services."
During the BAI demonstration, conference attendees will receive sample checks from several organizations' booths, and can then take them to other participating vendor booths to determine if the check is valid or not.
Advanced Software Design Corporation, Cheque-Guard, SQN Banking Systems and Fiserv are leading providers of check fraud prevention and image-survivable check security features solutions, software and products. PaymentsNation houses and operates a registry of image-survivable check security features for the payments industry. Silver Bullet Technology provided RangerFlex software which enables the use of virtually any check scanner.
PaymentsNation is a premier payments solution provider. The organization serves as both clearing house and information provider, offering educational events, forums, seminars, tools and resources for every type of payments professional. PaymentsNation offers a wide range of products and services, including payment system education, auditing, check settlement, collection item exchange, transportation contract management, risk management, training, clearing house rules, association administration services and advocacy. The PaymentsNation membership consists of approximately 800 financial institutions and holding companies that represent large, medium, and small banks, savings banks, credit unions, corporate credit unions, and banker's banks. Affiliate memberships are held by non-financial institutions. Visit PaymentsNation online at http://www.paymentsnation.com.
About Cheque Guard, LLC
Utilizing a full suite of custom software products, Cheque Guard provides innovative and customizable solutions for check fraud prevention, secure check printing, forms management, and image analytics to financial institutions of all sizes. At our core are three product groups that are designed with the Financial Institution in mind; ChequeSecure, our patented check fraud prevention product, utilizing an image survivable security mark; MICR Integrity Assurance (MIA); and ChequeSuite, check and forms management software. All three of these product categories address Security, Efficiency and Cost Effectiveness. With a forward-thinking management team and a committed and knowledgeable support staff, Cheque Guard builds value into every relationship. Visit Cheque Guard on the web at http://www.cheque-guard.com.
About Silver Bullet Technology, Inc.
Pensacola, FL-based Silver Bullet Technology, Inc. is the industry's foremost check scanner software developer, offering a comprehensive suite of Check 21 solutions and software tools. Silver Bullet has considerable experience working directly with financial institutions, scanner manufacturers and software vendors. Silver Bullet's newest software tool, Scout™, remotely tracks MICR and image quality and hardware performance, and displays the results in a concise web-based format. For more information, visit http://www.sbullet.com.
About SQN Banking Systems
For more than 20 years, SQN Banking Systems has provided integrated fraud detection and process improvement products for the financial industry, meeting the needs of financial institutions of all sizes. The SENTRY suite of products includes software for exception item processing, image fraud detection tools, automated signature comparison, signature verification and display, transaction analysis and safe deposit operations management. More than 500 SQN customers have improved their earnings and reduced check fraud losses by as much as 84 percent with SENTRY. For more information, visit SQN's Web site at http://www.sqnbankingsystems.com.
About Advanced Software Design Corporation
Advanced Software Design Corporation (ASD) is a software company specializing in end-to-end fraud detection and prevention solutions for image-based and electronic transactions. A pioneer and market leader in image-survivable check security features and interoperability, ASD's patented SAND® and ValidateCheck™ provide added value to our financial institution customers and partners. ASD solutions comprise integrated positive pay products, ARP, ACH fraud prevention; OASIS™ - multi-channel fraud detection - transaction analysis, image-analytics and Anti-Money Laundering. For more information, please visit http://www.asdc.com.
About Fiserv, Inc.
Fiserv, Inc. (NASDAQ: FISV), a Fortune 500 company, provides information management and electronic commerce systems and services to the financial and insurance industries. Leading services include transaction processing, outsourcing, electronic bill payment and presentment, investment management solutions, business process outsourcing (BPO), software and systems solutions. Headquartered in Brookfield, Wis., the company is the leading provider of core processing solutions for U.S. banks, credit unions and thrifts. Fiserv was ranked the largest provider of information technology services to the financial services industry worldwide in the 2004, 2005 and 2006 FinTech 100 surveys. In 2007, the company completed the acquisition of CheckFree, a leading provider of electronic commerce services. Fiserv reported nearly $4 billion in total revenue from continuing operations for 2007. For more information, please visit http://www.fiserv.com.