Thursday, November 21, 2024
Kate Childress | Executive Vice President and Head of Public Affairs of BPI | Bank Policy Institute website

Banks urge coordinated action against financial scams at Senate hearing

The Bank Policy Institute (BPI) has submitted a statement to the U.S. Senate Banking Subcommittee during a hearing focused on scams and fraud within the banking system and their effects on consumers. The statement outlines banks' ongoing efforts to safeguard customers against these threats and proposes seven government actions to further mitigate risks.

"The issue of combating scams and fraud is a nationwide challenge, one in which banks invest substantial resources to protect their customers and their customers’ money," stated BPI. "Such a far-reaching challenge demands comprehensive, multi-dimensional solutions."

According to Juniper Research, $9.3 billion is spent annually on tools for detecting and preventing fraud. Banks currently employ several measures such as consumer education campaigns, encryption controls, account monitoring, and real-time alerts. However, BPI emphasizes that enhanced coordination with the government could bolster these efforts significantly.

BPI's recommendations include appointing a federal director dedicated to fraud prevention and designating a single federal agency to lead anti-fraud initiatives. They also suggest equipping the government with tools for consumer education on self-protection against fraud.

Further recommendations involve promoting data sharing between institutions under supportive legal frameworks, holding all sectors accountable for mitigating fraud, increasing law enforcement resources for prosecuting offenders effectively, modernizing payment methods by reducing paper check usage in favor of secure electronic options, and eliminating screen scraping by third parties accessing banking information.

The full statement can be accessed through BPI's communication channels.

BPI is known as a nonpartisan public policy group representing leading banks across the nation. Its members include universal banks, regional banks, and major foreign banks operating in the United States.

Austin Anton

Bank Policy Institute

austin.anton@bpi.com

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