Whether it’s a bank, a brokerage, or a credit union, customers expect to be able to contact their financial institutions over the phone. They check account balances, transfer money, open new lines of credit, and change account information — each request being facilitated by a call center agent. However, these call center agents have few ways to determine whether the person they are speaking to on the phone is the actual customer, and this poses a serious threat that customer’s account information.
Caller ID is easily fooled by spoofing phone numbers or ANIs, and knowledge-based authentication questions (KBAs) such as “What’s your mother’s maiden name?” or “What was the name of your first pet?” are easily bypassed with the right information. A fraudster can socially engineer the answers, find them online with the multitude of personal information available through social media, or buy them on the black market. These criminals use every piece of data they can find to conduct sophisticated, multi-pronged attacks.
Call center agents are focused more on customer experience than fraud prevention, aiming to administer a pleasant, efficient authentication process so that they can address the customer’s problem or request as quickly as possible. When fraudsters gain access to legitimate customer accounts after surpassing security, they have the power to change contact information, passwords, and PIN numbers — blockading legitimate account owners from being able to access and secure their own money.
Global Impact by Institution
- Credit Card Issuers. One is every 832 calls is fraudulent — a static rate from 2015 to 2016. Regardless of the rate leveling off, it still remains the highest in comparison to other types of financial institutions. Criminals of all kinds value stolen credit card numbers because they’re the easiest and fastest way to steal large amounts of money with the lowest chance of detection.
- Banks. One is every 867 calls is fraudulent — a 61% increase from 2015 to 2016. Fraudsters have been redirecting their attacks downstream, increasing fraud rates for smaller institutions.
- Non-Banking Financial Institutions. These institutions include insurance firms, pawn shops, cashier’s check issuers, check cashing locations, payday lending, currency exchanges, and microloan organizations. Amongst these institutions, 1 is every 895 calls is fraudulent — a 79% increase from 2015 to 2016.
- Brokerages. 1 in every 1761 calls is fraudulent — a 53% increase in the call center fraud rate since the previous year.