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How Surveillance and AI are Enhancing Bank Security

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How Surveillance and AI are Enhancing Bank Security

By Jessica Burton, Global Enterprise Software Product Marketing Manager at Seagate 

The adoption of AI in surveillance is positively impacting industries across the globe, and financial institutions are no exception. In fact, more and more financial institutions are now embracing a “digital first” mindset that goes beyond their typical online customer offerings and are making their way to the in-store experience. The addition of AI capabilities online and in-person is enabling enhanced customer service which is crucial considering the emergence of on-demand consumer expectations.In fact, American Express’ VP and head of emerging strategic partnerships was recently quoted on the importance of differentiating customer service by using a blend of automation and human assistance, and this trend goes way beyond payments technology and messaging platforms. It is also now expanding to on-the-ground, AI-powered surveillance technology that is being utilized to not only keep customers safe, but also ensure that they have the best possible customer experience.

In addition to the newly emerging benefits of surveillance though, there’s still no denying that banks are prime targets for theft. In 2018, the Federal Bureau Investigation reported 3,033 robberies at U.S. banks. To best defend themselves from intrusion and fraud, financial institutions must ensure they have a multi-layered security plan in place that includes leveraging the latest technologies to deter crime.

Leading the pack for technologies most sought after by the banking sector is surveillance cameras with artificial intelligence (AI). These video solutions provide remote monitoring and advanced AI capabilities. Their analytics send alarms based on pre-determined patterns or images that indicate high-risk scenarios, such as identified criminals entering the building or suspicious ATM tampering. The demand for technology and the data that fuels it is highlighted in Data Age 2025’s findings that the global data-sphere, meaning the amount of data created, captured, and replicated in any given year across the world, will grow from 33 zetta-bytes in 2018 to a mind-boggling 175 ZB by 2025. The direct correlation there is that a majority of this data will directly stem from IoT devices, metadata, and video surveillance.

So how are banks best leveraging surveillance cameras with AI to increase their protection? The first instance is through implementing facial recognition technology at entrances, teller windows and ATMs to make note of people of interest. Whether it’s identifying a VIP customer to ensure they receive the best service, or identifying blacklisted patrons that security will need to attend to, this technology enables a bank to take its customer service to the next level. In fact, some banks in China are even allowing customers to use their faces instead of their cards for account authorization and transactions.

The second example is through the installation of motion detection in vaults and restricted areas. For highly restricted areas, motion detection cameras can increase situational awareness. Security personnel can now receive an alert every time a safe opens, as well as view the video feed to see who is taking this action, providing them with the opportunity to verify if the individual making the withdrawal is in fact an employee. Guards can also receive an alert if a suspect enters a high-interest area of the bank during non-operating hours.

Object recognition at ATMs are also gaining traction and are used to identify PIN compromise, ATM card skimming and jack potting, all common crimes that take place at ATM terminals. When individuals commit these acts, they often try to block the nearby camera. With object recognition analytics, these cameras can notify security operators if something has been placed over the lens to block its view. This instant analysis helps to identify suspicious activity in real-time so that law enforcement can quickly intervene.

The adoption of surveillance cameras with AI substantially improves not only the customer experience, but also crime prevention efforts. It also increases the amount of video and metadata captured as well as the length of time the information can be stored for deep learning. To respond to this shift in data flow, it requires banks to deploy robust surveillance storage devices at every level of the data workflow.

Storage technology that utilizes AI is an excellent option for banks whose primary storage needs are on-site at the NVR level and that require real-time decision making. Supporting up to 64 high definition cameras and 32 AI streams, these drives can be tuned for 24/7 workloads. Furthermore, for banks storying petabytes of video and metadata from thousands of cameras, enterprise drives can be well-suited for data center environments as they have heavy read and write workloads. SEDs should also be top of mind when considering security as they are independent of the operating system and provide an added level of cybersecurity. Lastly, solid state drives should be utilized to improve server performance and make better sense of the analytics that are being captured through the AI surveillance technology.

Surveillance cameras and AI are revolutionizing the way financial institutions view bank security, customer service and as a result, storage solutions. They will inevitably impact purchasing decisions in the future and AI in surveillance will become an integral part of the security ecosystem, empowering the industry to meet expectations securely and successfully.

Banking

Mastercard Delivers Greater Transparency in Digital Banking Applications

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Mastercard Delivers Greater Transparency in Digital Banking Applications 1
  • Mastercard collaborates with merchants and financial institutions to include logos in digital banking applications
  • Research shows that ~25% of disputes could be prevented with more details

As more businesses turn to digital payments, and the number of connected devices grows, one thing is becoming increasingly clear: consumers are demanding more clarity around what they bought and who they bought it from.

Most everyone has experienced the frustration of trying to decipher confusing and brief purchase descriptions when reviewing online statements. This confusion forces cardholders to contact their banks unnecessarily to dispute unrecognized transactions, adding extra steps for consumers and generating an array of costs for merchants and banks.

A new initiative from Mastercard and managed by Ethoca, the company’s collaborative fraud and dispute resolution technology, aims to eliminate this confusion and improve the customer experience. All merchants are encouraged to visit www.logo.ethoca.com and upload their logos for inclusion in online banking and payment apps. The merchant logos will be linked to corresponding transactions, adding clear visual cues to help cardholders quickly identify legitimate purchases. Participating merchants are provided an opportunity to simultaneously extend their brand presence as well as eliminate expensive and time-consuming chargebacks. This program is also available to all financial institutions.

Mastercard Delivers Greater Transparency in Digital Banking Applications 2

A recent Ethoca-commissioned Aite Group study of the US market revealed that 96% of consumers want more details that help them easily recognize purchases, and nearly 25% of all transaction disputes could be avoided by delivering these details – including logos. It’s estimated that global chargeback volume will reach 615 million by 2021, fueled in large part by frustrated consumers turning to the dispute process unintentionally.

“With greater digital dependency, having real-time purchase details is critical for consumers, merchants and card issuers alike,” said Johan Gerber, executive vice president, Cyber and Security Products at Mastercard. “We continue to collaborate with industry partners to bring clarity and simplicity before, during, and after transactions. By enriching transaction details, merchants can alleviate friendly fraud, reduce chargebacks and improve the customer experience.”

This endeavour is part of comprehensive efforts to deliver the most efficient, safe, and simple payment experience from the minute a consumer begins browsing to once they’ve made the purchase. This includes Click to Pay, Mastercard’s one-click checkout experience, to the integration of biometrics to secure both digital and physical transactions, and Ethoca’s full suite of consumer digital experience solutions.

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Banking

AML and the FINCEN files: Do banks have the tools to do enough?

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AML and the FINCEN files: Do banks have the tools to do enough? 3

By Gudmundur Kristjansson, CEO of Lucinity and former compliance technology officer

Says AML systems are outdated and compliance teams need better controls and oversight

The FinCEN files have shown that it’s time for a change in AML. We must take a completely new approach in order to catch up with the speed of innovation in financial crime.

Despite what you’ll read in news headlines, we can’t lay all of the blame for anti-money laundering failures at the doors of the banks. The majority of compliance teams are doing what they can, and what they are being asked to do.

Historically, AML has, in large part been a box-checking exercise. Banks have weaved through mountains of false alerts, investigated cases, sent SARs, and then got on with business as usual. In some jurisdictions, banks can‘t even interfere with customers under investigation, in fear of jeopardizing cases.

But the sentiment towards banks’ responsibility in AML is changing. They are increasingly looking at AML as a corporate social responsibility issue and even a competitive advantage. Banks are looking to protect their brands from the horrors of an AML scandal, and as such are taking a more proactive approach.

They are also throwing a lot of money at the problem. Deutsche Bank claims to have invested close to $1 billion in improved AML procedures and increased its anti-financial crime teams to over 1,500 people. Most big-brand banks have a similar story to tell.

With reputation on the line, better AML controls can become good business.

So where does the problem lie?

From the thousands of SARs discovered in the FinCEN files, lack of customer oversight is evident. Banks need to establish a method of knowing their customers through their actions across the organization and beyond the organizational walls. By doing so, banks can better understand AML and compliance risk, which gives them the necessary tools to bar customers from doing business or limiting their activity.

While banks are striving to better enforce regulations by pouring money and resources into CDD and transaction monitoring, forming this type of intelligent customer overview might be the real solution. Proper Customer Due Diligence and customer risk monitoring can only be achieved by continuously tracking customer behaviour and transactional networks. With the latest developments in Artificial Intelligence – that is now possible.

But, the reality for compliance teams is they are hindered by outdated technology in their risk assessment and transaction monitoring systems and because of this, banks are fighting a steep, uphill battle against serious organised crime.

In 2019, the Bank of England issued a statement that claimed: “existing (money laundering) risks may be amplified if governance controls do not keep pace with current advancements in technological innovation.”

I know from my time working as a senior compliance technology officer that many traditional AML systems are inefficient, slow and labour intensive, and often lead to inaccurate outcomes. In fact, most of the systems pre-date the iPhone, so they are using last-generation technology and techniques to detect criminal activity.

In short, legacy AML systems are not fit-for-purpose. Legacy vendors built them for the box-checking world of the past, and they are focused on one suspicious transaction at a time – rather than looking at ‘bad actors’ in the financial system, and patterns in their behaviour.

As launderers constantly evolve their techniques to circumvent rule-based or simple statistical detection, the AML systems market has not kept up. There is a dire need for innovation.

Unless systems are updated, banks can continue to file suspicious activity reports (SAR), but if bad actors can conduct their business ‘as usual’ and shuffle money around the globe to hide its malicious origin, the effectiveness of a SAR is significantly diminished.

What’s the solution?

I believe we need to rethink our entire approach to AML. We need to empower compliance departments with better controls and oversight, and move away from outdated, traditionally rule-based systems and towards a modern, AI-enabled, behavioural approach.

While the bad guys have learnt how to evade rule-based systems, they find it extremely difficult to get around AI algorithms that search for anomalies in behaviour. The advancement of AI algorithms, especially in the field of deep learning, provide an opportunity for banks to detect more complex and evasive money laundering networks.

So the answer is to establish continuous automated risk monitoring and implement a workflow system that provides money laundering risk scores for customers.

The latest AI software could kickstart a new age of customer AML risk-based overview. Instead of relying on static and self-reported KYC data, AI systems can analyse behaviour over a period of time and compare it with peer-groups and past actions. It provides compliance teams with a continuous risk-rating of their customers, actor insights and summaries to facilitate efficient and thorough investigations, and an organizational-wide overview.

Recent advancements in AI have not only made the above possible, but also practical. Our latest Human AI models contextualize and explain the appropriate data, making it easier for banks to spot sophisticated crime.

By looking at AML not simply as a box-ticking exercise, but as a competitive advantage that can increase customers’ trust in their financial institutions, banks have a lot to gain. Moving towards behaviour-based AML systems is a move towards making money good.

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Banking

Local authorities and business networks play a key role in small business success, and must be protected during COVID rebuild

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Local authorities and business networks play a key role in small business success, and must be protected during COVID rebuild 4
  • 23% of UK’s top performing businesses have been supported by local enterprise partnerships and growth hubs
  • Similarly, 30% of Britain’s strongest businesses have obtained external finance in the last 3 years
  • New findings come as part of an independent, holistic study into small business success, commissioned by Allica Bank to support British businesses

A new study, commissioned by business bank, Allica Bank, shows that a high level of engagement and interaction with external institutions and resources, is central to SMEs’ prospects of success.

The study analysed data from over 1,000 companies and ranked their success on a scale that evaluated factors including productivity, growth, consistency and outlook. To measure SMEs’ external engagement, survey respondents were asked whether or not they had engaged with local enterprise partnerships, growth hubs, or external financial advisers, as well as whether they had obtained credit or sought re-financing advice, in the last three years.

The benefit to small businesses in making the most of external resources are clear to see, with a quarter (23%) of the UK’s top performing SMEs – those in the top tenth percentile – actively engaging their local enterprise partnership or growth hub in the last three years. This compares to just 16% of all other small businesses. With such a clear benefit to businesses, these external networks must not only be protected but prioritised by any Government plans to rebuild the economy post-COVID.

Similarly, of the top performing SMEs in the country, 30% have obtained external credit in the past three years, compared to less than a quarter (24%) of all other businesses. This figure drops even further for the weakest performing businesses – those in the ninetieth percentile – where just 12% of businesses have obtained external financial support in recent years.

Chris Weller, Chief Commercial Officer, Allica Bank, said:

“At Allica Bank we understand that no two businesses are the same. We also know that no-one knows a business as well as its owners and managers. But they can’t be expected to be experts on everything.

“In the UK there is a wealth of external advice and support for small businesses and we urge each and every business out there to tap in to the external resources around them. Third-parties, such as business clubs, chambers of commerce, local enterprise partnerships and trade bodies, can be invaluable sources of advice and further resources. And although they have excelled in their given field, business owners may still lack knowledge in many other areas of running and growing a business. Therefore, engaging with third parties can give business owners the kinds of insight – and fresh perspectives – they need to succeed.

“As the economy and the country comes to terms with the impact of the COVID-19 pandemic, it is important these vital SME resources are protected and given the funding they need to continue providing invaluable insight and support to small businesses up and down the country.”

Allica Bank’s SME Guide to Success identified six ‘rules to success’ that were more likely to be displayed by top-performing SMEs compared to their counterparts. The full report contains a wealth of additional data and insight into each of these topics.

As part of its mission to empower small businesses, Allica Bank is making the findings freely available and running a series of free online workshops with relevant partner organisations for businesses to attend.

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