To avoid these situations, it is necessary to invest in anti-fraud intelligence technologies
Business scams are everywhere: fraud, regulatory issues, data leakage and the origin of financial resources, even external situations that are practically uncontrollable – such as a political/financial scandal or the occurrence of a natural disaster. In this sense, having a risk management plan, according to Caio Rocha, Director of Authentication and Fraud Prevention Solutions at Serasa Experian, with the use of cutting-edge technology, can be crucial to shield the financial health and reputation of a business.
“Each and every company can be subject to digital attacks and financial or reputational damage. Therefore, create a strategy to authentication and fraud prevention it must be an inside-out process. The purpose is to minimize the chances of any incident occurring and to have an immediate and efficient response if something happens”, adds the executive.
There are two common risks in companies, the first of compliance and implementation of internal controls, and the second of money laundering and terrorist financing. For Caio, “it is interesting to start with the identification and assessment of reputational and economic risks that may be associated with the company's activity, and goes through the use of solutions that provide constant monitoring and authentication of all these points that have been identified”. In both situations it is possible to create previous threat management protocols and use technologies and analytics. Check out:
1. Compliance and implementation of internal controls: meaning “compliance, being within the rules” in English, professionals in the area are responsible for creating policies that ensure the identification of conflicts of interest when hiring suppliers and business partners. In compliance with regulatory bodies, the company must establish which policies can automate the monitoring and auditing of internal processes.
Serasa Experian's "Orange Profile Alert" is an example of a solution for identifying possible fraud linked to the use of orange beads. “Due Diligence” is also another type of internal control established by Compliance teams to evaluate companies in merger and acquisition processes or that are establishing partnerships. In it, various types of information about the company are gathered to support the final decision (assets, legal liabilities, human resources, technology, accounting, market value, among others);
2. Prevention of money laundering and terrorist financing (PLD/FTD): money laundering is “the act of hiding or disguising the illicit origin of goods or values that are the result of crimes”. There is even a Money Laundering Prevention Day, on October 29th.
Creating protocols to prevent this practice consists of implementing strategies that help identify financial transactions and clients suspected of hiding the illicit origin of a resource, for the purpose of reintegrating them into the economy or for financing activities linked to terrorism. Money laundering in the financial market is an even more critical point, since the reputation of the institution involved in these cases, ultimately, puts the stability of the financial system at risk and, consequently, the financial integrity of the country.
The Serasa Experian PEP List has functionalities that identify the presence of Politically Exposed Persons (PEPs) with relevant positions, jobs or public functions in the last five years in Brazil, their business relationships (data of partners, administrators and spouse) and relatives (father, mother, children, siblings, grandparents and grandchildren), in addition to corporate structure data. Companies in the regulatory segment can use it, such as insurance companies, banks, financial institutions and high value-added goods industries (among others). Companies in non-regulatory sectors as well, such as large retailers that offer credit through financial services and telecom companies that choose to maintain this type of active monitoring.
“More than having an area dedicated to Compliance, every company needs to train employees so that they are able to identify problems and alert those responsible. In this way, with the help of an efficient fraud monitoring and prevention plan, they can commit to disseminating this culture within their teams and prevent these situations from occurring”, concludes Caio Rocha.
To learn more, visit the page Authentication and Fraud Prevention solutions by Serasa Experian.
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