Collaboration is the best way to combat fraud
Speakers concur that collaboration is the best way to combat fraud at the SAFPS and ICB Inaugural International Fraud Conference
“It’s a Bring and Braai,” said Manie van Schalkwyk head of the Southern African Fraud Prevention Service (SAFPS) at the Inaugural International Fraud Conference, this week, a few days ahead of Heritage Day.
He stressed the importance of collaboration and cooperation, a theme that underpinned the key message of this global initiative.
“If you don’t bring meat, you won’t eat,” he added, explaining that members of SAFPS had to supply fraud-relevant information to the organisation in order to derive benefits from the comprehensive data library that is resourced by SAFPS.”
All major SA companies have access to the SAFPS database, which is the largest confirmed fraud database in the country. Van Schalkwyk urged members to put forward their own data, to maximise the data that is available.
“We have trusted data base management, are non-competitive and valued for our independence.”
SAFPS also develops new products and increases its data resources.
Speakers from South Africa, Australia, the UK and representation from the Netherlands concurred that a collaborative effort was the only way to combat fraud.
Brigadier Scott Naidoo, head of Interpol South Africa, said the events of 9/11 in the United States changed the way the world looks at cooperation and that there could have been a different outcome had the pockets of intelligence information been shared.
He cautioned: “When sharing information, be responsible and accountable for the utilisation of that data.” He added that there were some barriers to sharing. “Local data protection laws prevent information sharing, information is sensitive and organisations are reluctant to expose their footprint of their trade craft; there is covert intelligence and technology constraints.”
“Interpol can share data within 24 hours but this becomes difficult when countries do not have the infrastructure to facilitate access,” Naidoo said.
Garth de Klerk CEO of the ICB, speaking about crime in the insurance sector, said among common cases of fraud were ‘walking dead’ – people with identity documents of the deceased, multiple claims against car insurance and life policies. “There is a new scheme every day.” He said fraudsters did not act alone. “Data is used to identify syndicates,” he said.
He added that the ICB was in full support of collaborative initiatives to combat insurance crime and fraud.
In Australia, financial crime costs the country $6bn. The current focus is on identity theft, card not present fraud, ATM skimming, card fraud and the New Payments Platform. David Pegley CEO of the 12-month- old Australian Financial Crimes Exchange, said that in the space of a year the exchange had amassed 852 600 data records. “It is our aim to connect and collaborate to share real-time knowledge and hone detection methods.”
Mike Hayley, deputy CEO of CIFAS, previously known as the Credit Industry Fraud Avoidance System, said the UK had experienced growth in identity fraud owing to increased access to data. Speaking for the Dutch Payment Association, Hayley said there was a variety of fraud in the Netherlands, much of it as a result of the internet where “there is no contact with the victim, it’s easy, there is a low risk of getting caught and it’s lucrative.”
Manoj Chiba, senior advisory consultant at the Gordon Institute of Business Science, spoke about profiling using data and predictive analysis. He said data could be gathered from sources other than text. “Images and voice give away a great deal of information on social media.”
He said data scientists had an important role to play in fraud prevention. “Predictive analytics is not 100% accurate but it will get it right seven out of 10 times.”
Alison Lee of Lee’s Legal Compliance Services presented a detailed breakdown of the POPI Act and its impact on reporting and/or sharing information about fraudster and other criminals.
Day two saw discussions on cybercrime and Bitcoin presented by Lorien Gamaroff, founder and CEO of Bankymoon, a blockchain and crypto currency consultancy. Discussions included a presentation on regulatory issues concerning Bitcoin, to clarify the practical implications of this crypto currency.
Gerda Ferreira, executive head of Group Financial Crime and Forensic Services at Nedbank Ltd, presented a talk on forensics and investigations.
The afternoon session continued with Analytics presented by Mike Haley followed by a close study on healthcare fraud, waste and abuse and how it often dovetails with insurance fraud. Lynette Swanepoel of SAFPS provided insights on the increasing levels of sophistication and syndication by fraudsters and their networks, with a discussion on possible solutions for the sector.
The final item of the session was a presentation by Hugo van Zyl, COO of ICB.
In closing Van Schalkwyk said: “This was a ground-breaking gathering of industry professionals. We are thrilled with the global importance of this event as a first for the industry. The international exchange has proved that there is a common goal towards collaboration and information sharing, which will serve to address the new challenges that are agreed as the nameless, faceless and borderless fraudster, with a combined and focused effort.”
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