Barclays’ expert highlights importance of fraud awareness

Friday 28 November 2014

The challenges facing the global finance industry as a result of fraudulent activity were the subject of a recent seminar hosted by Barclays wealth and investment management.

Sean Hegarty, from the bank’s corporate banking fraud risk management team, was in Jersey to discuss marketplace trends and the new challenges facing finance professionals as cyber related fraud becomes more prevalent.

“Risk of fraud can stem from many normal aspects of running a business. Restructuring departments or launching new products can open avenues for fraudsters to exploit if handled incorrectly,” said Mr Hegarty. “In addition to that, criminals are becoming better informed thanks to the internet. Eighty-four percent of identity fraud is committed using data found online.”

Mr Hegarty identified several types of fraud that were currently occurring in increasing levels.

“Invoice or mandate fraud occurs where supplier payment details are requested to be changed by a third party, misdirecting funds to another account. Cheques can also be intercepted and misused. Detail is important here as checks on payments will turn up any discrepancies,” he said.

Electronic channels are secure, according to Mr Hegarty, however there is risk where the correct procedures are not followed like logging out of the systems securely. Anti-Virus protection is also a key defence against the online fraud threat.

“Vishing and phishing are still very common and should be looked out for,” he said.

Most organisations have controls in place to secure themselves and their customers against fraud and Mr Hegarty said it was essential that processes are followed correctly.

“There are a few key points that businesses can keep in mind to ensure they keep on top of fraud. Review controls frequently, screen employees fully and train them effectively. Also consider whether your payment validation systems are adequate. Openness is also effective, for example talking about fraud with staff and clients and making sure staff are aware of the risks of sharing passwords and logins,” he said.

Neil McCluskey, head of offshore and local markets at Barclays in Jersey said: “No-one wants to be the victim of a fraud or see their clients affected in this way. We’ve heard from Sean of several ways businesses can make themselves more secure and it’s been great that we have been able to share Sean’s expertise with the Jersey business community.

“Barclays is committed to using our business to help people, companies and organisations succeed and to contribute to growth in our local community. Having the opportunity to share our knowledge around these issues through seminars is a major part of this support.”