Absa adopts fraud detection software

JOHANNESBURG (03/18/2004) - Absa Ltd. says that it is the first bank in the country to implement an advanced debit card fraud software system which detects fraud in near real-time.

The strength of the Bankserve Fraud Management System (FMS) lies in its neural network technology, which identifies subtle patterns of suspicious or unusual behavior by comparing individual card usage with known patterns of fraud, Absa says.

Bankserv's FMS proactively monitors Automated Teller Machines (ATMs) and point-of sale (POS) debit card transactions to detect suspicious activity. Activity that matches suspicious patterns can be automatically queued for review by the bank's analysts.

"Absa is a long-time Bankserv client and shareholder, and we are proud that it has enlisted us to help expand its fraud-fighting efforts," says Alison Foote, business development manager at Bankserv. "In the hands of skilled investigators, Bankserv Fraud Management System (FMS) can provide an effective tool in the bank's efforts to protect its cardholders and fight fraud."

A simple example of how Bankserv FMS can detect a fraudulent transaction might involve multiple cash withdrawals coming from Johannesburg and, minutes later, a cash withdrawal in Durban on an account with only one active banking card.

Once Bankserv FMS has flagged this transaction, the bank's analyst would see that transactions are being done simultaneously in two different regions of the country, and realize that a counterfeit card has probably been produced.

The legitimate customer can be contacted immediately, minimizing the inconvenience to the customer, and reducing the bank's potential loss.

Bankserv is a primary service provider of shared services for southern African banks and the system is implemented with Prism risk management software. Foote says, "Combating card transaction fraud is a shared responsibility between our individual shareholders and ourselves at Bankserv, and this initiative will help to reassure the growing number of customers relying on e-payment transactions that we are serious about offering the best level of protection we can."

Says Walter Volker, GM: Absa Group Systems: "Absa expects to see the Bankserv FMS solution provide a cost-effective means to monitor debit card-based transactions in real time as those transactions are processed for approval.

"It is always better to pro-actively be able to detect card misuse or fraud, which is exactly what this joint initiative enables us to do. It certainly is another major step in the right direction," says Volker. Absa has been piloting the system since 22 February 2004.

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