FICO and Jersey Telecom Unite to Combat APP Fraud
In a significant step to tackle the growing issue of financial scams, global analytics leader FICO has partnered with Jersey Telecom (JT). Their collaboration aims to develop a cutting-edge solution that provides direct, near real-time intervention to help protect consumers from the increasing threat of Authorised Push Payment (APP) fraud.
What is APP Fraud?
APP fraud happens when unsuspecting individuals are manipulated into authorizing payments to scammers. Experts from Jersey Telecom highlight that this type of deceit is on the rise in multiple countries. In the UK alone, losses from APP fraud reached around £460 million in a recent year. Acknowledging the urgency of this matter, FICO and JT have created an advanced solution that enables instant engagement with customers to determine if a payment is secure before it goes through.
How Telephony Signals Play a Role
The partnership between FICO and JT involved collaborating with leading banks in the UK to identify essential telephony signals. These signals are key indicators that a scam could be unfolding. FICO's Customer Communications Service Scam Signal uses telephony data along with customer and payment details to build a sophisticated method for detecting and preventing APP fraud.
A Framework That Respects Privacy
JT's collaboration with the GSMA and other mobile network operators strengthens its capacity to analyze mobile network information while adhering to privacy laws to safeguard users' personal data. FICO's research has uncovered specific behavioral patterns in customers that could indicate fraudulent actions. For instance, discussions happening on mobile devices can often lead people to unwittingly comply with a scammer's requests.
How the Scam Signal Works
The Scam Signal employs advanced analytics, merging real-time network data with transaction payment info. This combined approach effectively detects and prevents social engineering schemes designed to defraud consumers. The technology supports a wide variety of mobile networks, ranging from 2G to 5G, and is currently being adapted for UK landline services.
Customized Customer Interventions
By incorporating the Scam Signal into the FICO Customer Communications Service, banks can send personalized and timely messages to customers during transactions that appear risky. FICO's Adam Davies notes that these strategic messages are effective at disrupting a scammer's attempts to manipulate customers. Through a series of immediate, tailored messages, if a customer hesitates or questions a payment, the system can encourage them to consider delaying the transaction or reaching out to a fraud prevention expert.
The Impact of This New Solution
Several major banks in the UK are in the process of implementing this innovation, with preliminary trials showing a notable decrease in fraud. Early adopters of the Scam Signal have experienced a 41% reduction in individuals falling victim to scams, a 44% decline in financial losses due to these scams, and an impressive 55% drop in false positive rates—allowing legitimate transactions to proceed without unnecessary interruptions.
About FICO
FICO (NYSE: FICO) is a renowned company with a legacy that dates back to 1956. Recognized for its pioneering work in predictive analytics and data science, FICO holds over 200 patents for technologies that boost profitability and enhance customer satisfaction across various sectors. From protecting 4 billion payment cards around the globe to improving risk management strategies, FICO plays a pivotal role in reshaping the financial services, insurance, telecommunications, and other industries. The well-known FICO Score, used by most major lenders in the United States, is a widely accepted tool for assessing consumer credit risk.
About Jersey Telecom
Jersey Telecom, which originated as a government-owned enterprise, has successfully transformed into a leading global technology company. Established over 135 years ago, JT focuses on providing innovative connectivity and mobile solutions while employing more than 500 staff across the globe. By launching fiber-to-home services in 2018, JT has solidified its status as an industry frontrunner. With the rollout of energy-efficient 5G services in 2023 and the acquisition of Spectrum Message Services, JT is enhancing its mobile intelligence offerings, supporting secure transaction notifications for over 135 million users worldwide.
Frequently Asked Questions
What is Authorised Push Payment fraud?
Authorised Push Payment fraud refers to scams where individuals are tricked into approving money transfers to fraudsters.
How does the Scam Signal function?
The Scam Signal utilizes real-time network and transaction data to identify potential scams as they occur, allowing for immediate customer support.
What advantages does the FICO and JT partnership provide?
This collaboration enhances customer protections against financial scams through timely communication and intervention during potentially suspicious transactions.
What improvements have been observed from this technology?
Initial trials in the UK indicate a 41% decrease in scam victims, along with significant reductions in fraudulent losses and false positives.
How is privacy addressed in this solution?
The solution operates within a framework that complies with privacy regulations, ensuring customer personal information remains protected while detecting potential fraud.
