ADOPTING AN EFFECTIVE FRAUD MANAGEMENT FRAMEWORK FOR FINANCIAL INSTITUTION
Fraud presents a notable risk for financial institutions, and adept management of this risk is crucial to limit financial losses, uphold customer trust, and adhere to applicable regulations. Within this article, we'll explore the primary strategies that risk experts can employ to establish a robust fraud risk management program within banking institutions. Risk Assessment and Identification: Banks begin by conducting a thorough assessment to identify potential areas of vulnerability to fraud. This involves evaluating internal processes, systems, and external factors that could pose risks. Understanding the types of fraud prevalent in the banking sector (such as identity theft, account takeovers, payment fraud) helps in identifying potential areas of concern. Policies, Procedures, and Compliance: Developing robust policies and procedures aligned with industry standards and regulations is crucial. These policies cover fraud prevention, detection, and response protocols. Compliance wi...