Strategic Advice

As corporate payments move closer to real time, the risk of fraud increases.

It’s easy to see why: faster payments mean companies have less time to detect and stop fraud, and funds may be gone for good.

Wire transfers are moving up as the most targeted method of attack in the past few years, especially at large companies with many payment accounts.^{Disclosure 1} Brown notes that they’re particularly vulnerable because they’re “immediate and final.”

Manual reviews and batch processes are too slow to be effective in many cases. To stop fraud, detection has to be just as fast as the payment itself.

Real-time fraud monitoring and predictive risk modeling can be important components of a broader fraud risk management strategy.

Static defense methods won’t hold up against dynamic fraud offensive attacks. In the past, technology limitations made fraud detection largely reactive, but now, machine learning is overcoming those barriers, Brown says.

“A lot of traditional tools are post-transaction,” he explains. “What’s emerging now is how to get in front of those transactions.”

That requires a different approach. Intelligent detection models can evaluate many signals simultaneously, such as:

• How and when payments are typically made
• Relationships between payers and payees
• User activity across systems and devices

These models can also learn unique signals over time. That allows for increasingly nuanced risk scoring. So instead of generating more alerts, AI-driven systems can prioritize the right alerts to reduce false positives while improving accuracy.

Technology alone isn’t enough to stop fraud. Attacks often succeed because of a combination of process gaps, breakdowns in communication, or simple human error.

“There’s a misconception that if we’ve implemented the right fraud software, we’ve solved the problem,” Brown says. That risk may be highest for midsize companies that are large enough to be on a criminal’s radar, but small enough to lack comprehensive fraud defenses.

“They have fewer dedicated fraud or security specialists and fewer layers of approval. They may rely more on trust-based processes,” he says.

Effective fraud prevention requires a combination of:

• Technology to detect and assess risk
• Controls to enforce approvals and verification
• Awareness to strengthen employee vigilance

Organizations that rely too heavily on any one defense tactic may be at risk of leaving an opening for an attacker to exploit.

The new rules of fraud prevention will require adjustments by your treasury team. But an immediate overhaul shouldn’t be necessary. That’s because you may be able to apply advanced detection capabilities to your existing practices such as approvals and payee verification as an improvement, not a replacement.

Brown says a new approach to fraud prevention centers on tightening decision points, which begins with greater awareness and education around payment risks that artificial intelligence can help mitigate. He adds that effective implementation depends on prioritizing “quick wins” that are high impact but low disruption.

You can prioritize your implementation by approaching the process in stages.

1.     Start with high-risk moments. Strengthen the approval workflow for high-value payments and apply anomaly detection to flag new payees and payment changes.

2.     Expand pre-payment visibility. Monitor activity across all payment types to flag unusual behavior before transactions are finalized.

3.     Measure prevention, not just detection. Track metrics such as prevented losses, reduced false positives, and faster resolution of alerts.

When a company’s fraud security is on the line, any change can cause anxiety, Brown says. Finding the right balance of controls that aren’t so restrictive they slow operations or frustrate users but still provide robust protection is tricky and often requires experienced advice.

Truist professionals can help evaluate fraud prevention approaches based on your organization's needs and objectives, with data, insights and real-world guidance that fit your unique situation.

“Banking partners are most valuable when they act as a risk advisor and integrator, not just a service provider,” Brown says.