Reported by Orla McCaffrey

The American Bankers Association is creating an information-sharing exchange that member banks will be able to use to get the names and account information of suspected scammers almost in real time.

The exchange, which has yet to be named, is designed to combat a range of financial crimes from fraud to money-laundering to the financing of terrorism, ABA President and CEO Rob Nichols said Tuesday at the trade group’s financial crimes enforcement conference.

“We believe this effort can make a real difference in fighting financial crime,” Nichols said. 

Combating fraud is an expensive and frustrating challenge for banks of all sizes. Pre-pandemic fraud risks, including those related to in-store credit card purchases, have made a comeback.

Another top-of-mind risk for banks is check fraud. During a six-month period earlier this year, Regions Financial in Birmingham, Alabama, reported losing $135 million to bogus checks. JPMorgan Chase is using artificial intelligence to identify fraud in checks and elsewhere.

In fraud cases known as business-email compromise, the platform that the ABA is building would help banks alert other financial institutions with key information about the account of the alleged fraudster, said Paul Benda, senior vice president of operational risk and security at the ABA.

Read full report: https://www.americanbanker.com/news/aba-to-launch-information-sharing-exchange-to-help-banks-fight-fraud