Fraud Management & Cybercrime , Fraud Risk Management , Video
How Banks Can Address First-Party Lending Fraud
FTI Consulting's Anna Bleazard on Why Banks Need to Spot Lending Fraud Early
The lack of understanding as to what constitutes first-party lending fraud is causing massive losses at banks. Anna Bleazard, head of financial crime compliance for Singapore and South East Asia at FTI Consulting, recommends that banks intervene as early as possible.
See Also: The Rising Threat of Fake Business Accounts
First-party lending fraud happens when fraudsters provide the right personal information but exaggerate or falsify their financial data to a lender. As a result, the person may be approved for a loan they do not actually qualify for.
"About 68% of first-party lending fraud is caught after account origination. Now, that is a large volume that is not caught right at the beginning, which is when ideally you would like to try and capture this fraud," said Bleazard. "Historically, there has been a lot of focus on detection, whereas the focus needs to change to prevention, aiming to intervene at the earliest possible stage."
The best way to limit lending fraud, Bleazard said, is to create more accurate loan application profiles.
In this video interview with Information Security Media Group, Bleazard also discussed:
- Why first-party lending fraud is common in the APAC region;
- How banks can better spot first-party fraud;
- Tools that banks can use to try to reduce first-party fraud.
Bleazard is a qualified chartered accountant with extensive experience in financial crime, forensic accounting, disputes and litigation support.
