How to monitor social media sites for fraud detection

Organizations looking to adopting robust fraud detection process to identify future threats.

Social media platforms allow for sharing information and ideas globally and can be a great resource to connect with friends and family or grow a business. Unfortunately, while there are positive and constructive ways to use social media platforms, fraudsters are using social media at an alarming rate to post intel on how to commit fraud against financial institutions. Fraudsters use social media platforms and private discussion boards to exchange and sell stolen personally identifiable information (PII), sell bots used to set up new accounts automatically, and post videos with step-by-step instructions on how to defraud financial institutions. These instructional videos are tailored to a financial institution and outline how the fraudster can circumvent the applicable fraud controls. This information is used to open new fraudulent customer accounts and fraudulently take over existing customer accounts. This behavior can become very costly to a financial institution from a financial standpoint through fraud losses, increased compliance costs, and the costs associated with losing customers due to damage to the financial institution’s brand and reputation.

Protecting your organization against threats

1. Consistently monitor social media sites for potentially fraudulent activity. This could include:

a. Activity specifically involving your financial institution

b. Identifying other institutions that fraudsters may have accounts with to fund or withdraw funds from these fraudulently created or obtained accounts

c. Identify industry trends to identify possible fraudulent methods or other red flags

2. Implement or supplement controls in the account opening process, including verifying identities and beneficial

3. ownership of business accounts

4. Conduct internal trend analysis to reveal patterns of potential account fraud

5. Train employees on new and developing fraud schemes

6. Enhance communication across the organization to share trends, patterns and red flags

7. Report these posts to the proper authorities and application administrators to remove the postings

Next steps with EY Forensic & Integrity Services

1. Our EY Forensics team can deploy cost effective teams to conduct monitoring of social media sites on behalf of your organization and assist in creating a formalized social media monitoring program

2. Provide training and educate employees on potential red flags

3. Perform trend analysis to identify potentially fraudulent accounts

4. Propose policy and procedure updates to enhance information sharing across the organization

5. Recommend controls to mitigate risks associated with these bad actors