Shazam! Experts Fell For a Fake Product From A Nonexistent Company In A Fraud Test

Cyber security pros and risk analysts should be better than the average person at detecting fraud, but a little over three percent submitted their personal identification information to sign up for an app described as “Shazam for voice identification.”

Credit Trulioo, a global identity and business verification company, which launched an online fraud experiment to evoke some interest around International Fraud Awareness Week. (It was also National Nurse Practitioner Week and Dear Santa Letter Week and almost overlapped with Intimate Apparel Marketing Week.)

Trulioo said that despite the abundance of online resources and press coverage on fraud and fraud prevention, the Federal Trade Commission (FTC)  received nearly 2.7 million fraud complaints in the United States last year.

So Trulioo set out to learn whether fraudsters, under the guise of a fake company, offering a fake product, could convince internet users to disclose their personal information.

It created a web page for a fictitious company called Agile ID Technologies, offering a fictitious mobile app, “Aurdentity”. Marketed as “Shazam for voice identification”, the fake mobile app claimed to use voice recognition technology to not only identify people when exposed to their voice, but also retrieve background information about them.

Trulioo ran a week-long campaign that delivered ads to compliance professionals, fraud and risk analysts, and other individuals who showed an interest in data privacy, cybersecurity and technology, and may even have had credentials. They were directed to a fake company’s web page where visitors were asked to sign up for Audentity by providing their personal information including name and email addresses. None of the information was recorded or stored, unfortunately eliminating the possibility of followup interviews.

The campaign resulted in a total of 2,139 unique visits to the fictitious company’s website. Of those visitors, 66 people completed the sign-up form.

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Gates Foundation Supports Expansion Of An Open Mobile Banking Platform in Africa

Two of Africa’s largest mobile operators and mobile money providers, Orange Group and MTN Group, have announced they will use open source financial services technology that was sponsored by the Bill and Melinda Gates Foundation.

The two companies call their joint venture Mowali (mobile wallet interoperability), to enable interoperable payments across the continent. Mowali makes it possible to send money between mobile money accounts issued by any mobile money provider, in real time and at low cost. It gets off to a strong start with more than 100 million mobile money accounts between the two providers in 22 of sub-Saharan Africa’s 46 markets. It sees the potential to reach the 338 million existing mobile money accounts in the continent.

It uses Mojaloop, an open sources payment platform that the Gates Foundation launched at the SWIFT Sibos conference in Toronto last year.

Kosta Peric of the Gates Foundation

“Interoperability of digital payments has been the toughest hurdle for the financial services industry to overcome in support of financial inclusion, said Kosta Peric, deputy director of financial services for the poor at the Gates Foundation. “This is a signal that a new wave of innovation, which can help alleviate poverty and drive economic opportunity, is coming.”

At the launch during Sibos last year Peric said that in Kenya it is estimated that M-Pesa helped 194,000 households move out of extreme poverty. Mowali can extend that mobile money reach to more people.

“Systems like M-Pesa are great, but most are a closed loop,” said Peric.

Mowali is a digital payment infrastructure that connects financial service providers and customers. It functions as an industry utility, open to any mobile money provider in Africa, including banks, money transfer operators and other financial service providers.

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Social Security? The Numbers Say To Get In Early As Possible

Take Social Security as soon as you can — at 62 advises Steve Maersch, contradicting just about everyone in the retirement advice business. He even lists some of them: The Wall Street Journal, Forbes, Kiplinger magazine, Consumer Reports, Motley Fool, Vanguard Group, CNNMoney, Suze Orman, AARP and Boston College’s Center for Retirement Research. (Steve has been a personal friend for years, and making these arguments as long as I have known him. Someone said if he knows so much why didn’t be write a book, so he has.)

Maersch, a retired copyeditor at the Milwaukee Journal, earned an average of $24,800 over his 31-year career and is now a millionaire, partly by using borrowed funds — at one time more than $500,000 when he was earning in the mid twenties — to invest in the company’s stock program for employees, — and then selling as fast as he could once the company went public. This is completely at odds with much financial advice which says never invest in the company where you work because that just increases your personal risk, what Maersch calls the Enron warning. But the U.S. has 11,300 companies partly or entirely owned by employees, he notes. Presumably most of them are honestly run.

The math — no, make that the arithmetic since Maersch has no patience for the complications investment professionals often indulge in — requires nothing more than a calculator to see how this works. Maersch’s accountant yelled at him to start taking Social Security when he turned 62, and he did. Between the ages of 62 and 65 Maersch collected $54,700 which invested in Vanguard’s Wellesley Income Fund was worth $67,083.

From 62 through 69, Maersch collected $111,543 in Social Security. Based on actual returns for the Wellesley fund that would have grown to $155,000. His investment returns will more than make up for the higher Social Security payments he would have received by waiting until he was 70 and even after taking those make-up amounts out of the fund, the investment continues to grow.

Another factor to consider is mortality — 10% of us will die between 62 and 69 added Maersch who has been to funerals for several friends who died in their sixties.

David Blanchett, head of retirement research at Morningstar, told me he disagrees with taking Social Security early. Delay taking it as long as possible, he said.
“The bad outcome is you live to be 100 and you have spent all of your wealth. If you delay claiming for eight years Social Security rises 76 percent.”

Maersch crunched the numbers for old age, taking it out to age 110.

“In this scenario, at age 110, wait-till-seventy’s Social Security would be $47,477 a year. Mine would be $34,044, or $13,433 less. My Social Security/Wellesley account — after making up this shortfall and those of the preceding 39 years — would be worth more than $425,000.”

He is not a buy and hold investor but follows the January Barometer. On Jan. 31 if stocks are outperforming bonds, he stresses stocks, If bonds are outperforming, he goes strongly into bonds. He lays out the numbers in his book.

“The January Barometer has its critics. A long article in the Wall Street Journal in 2017 declared the January Barometer to be a myth. The author did everything but run the figures.”

His book, which is easy and often amusing reading, and under 100 pages, offers some other practical advice: buy used cars (after having them checked by a mechanic); buy a freezer; keep your accounts at a credit union rather than a bank; invest only in low-cost funds with fees under 1 percent (he is entirely in a few Vanguard funds), use dollar stores, budget stores and outlet stores and keep your finances on an index card that you update monthly with savings, income, debts, investments and upcoming expenses.

He recommends two books by Jack Bogle, founder of Vanguard, and also Tony Robbins’s MONEY Master the Game and Unshakeable. Robbins is the first finance author he has read who stresses the importance of charity.

When the Milwaukee Journal CEO in 1986 saw an impending change in tax law that would make charitable donations less valuable, he encouraged employees to put $25,000 of their stock into donor-advised funds with the Greater Milwaukee Foundation. Maersch and his wife, Judy, did. The Foundation withdraws 4.75% each year.

“This year (2018) Judy and I will write more than $5,000 in grants, and our total donations will then exceed $100,000…When Judy and I pass on, our fund will continue and a living tombstone, producing grants to help minority students with college expenses.”

It is a thought-provoking book that could inspire you to pull out a calculator and see for yourself.

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Does Anyone Outside PR Firms Think Surveys Are Newsworthy?

In a recent blog at Articulate Communications I wrote about the number of surveys that public relations firms send out, and how useless many of them are. I just reviewed my Inbox to see what the recent evidence is…the results are below and include six surveys I have received so far today. They include such stunning news as John Hancock on mindfulness and  a bit on risk analysis that survey 499 residents of Tianjin, China on how they view self-driving cars.  Really, what  could I have done without these survey press releases?

I publish occasionally at the Articulate Communications blog  on issues of financial technology, banking and associated public relations and marketing topics. In the past I have written about design thinking, how to avoid bank PR-speak and whether banking and innovation belong in the same sentence.

Here are some recent surveys I have received and ignored, at least until now.

June 14 from the Society for Risk Analysis: Survey Says: Self Driving Cars Should Reduce Traffic Fatalities by At Least 75 Percent to Stay on the Roads…The survey was distributed to a convenience sample of residents in Tianjin, China. Of the 499 respondents…The broadly acceptable risk criterion for SDVs is set as two orders of magnitude lower than current global traffic risk…

June 14 — Not quite sure what this John Hancock release has to do with anything, but here it is:
According to the John Hancock Mindfulness Survey, Americans are missing out on the benefits of mindfulness, as only 12 percent of respondents practice meditation or mindfulness when they are stressed. Of those who do, nearly 70 percent cite meditation and mindfulness as the most effective activity for managing their stress, ranked above listening to music, sleeping or exercising.

June 14 Kount’s 6th Annual Mobile Fraud & Payments Survey Finds Complacency and Regression Among Merchants’ Mobile Fraud Mitigation Strategies…about 35 percent of merchants still do not track mobile fraud… Only half of surveyed merchants believe the mobile channel requires additional or specialized tools, compared to between two-thirds and three-quarters of merchants in each of the past studies…

• Most notably, merchant support for Apple Pay has gone down from 48% to 35%
• Google Pay (previously Android Pay), is down from 38% to 25%
• Support for PayPal increased (from 48% to 64%) while 10% accept AliPay and 10% accept other e-wallets.

June 14 Remitly Study Reveals 9 in 10 Immigrants in the U.S. Believe the American Dream is Still Achievable

Remitly found more than half of first-generation immigrants (60 percent) would still recommend relocating to the U.S. to a friend, family member, or colleague…Sixty-two percent of immigrants trust mobile technology to handle their finances

June 14 A global poll of SMEs and microbusinesses, conducted by global booking software platform, has discovered that tech skill shortages and the cost of administration are among the biggest threats to entrepreneurship in Britain after Brexit.

• The biggest surprise to business owners was needed to do ‘too many things at once’, with 43 per cent registering that as their biggest grievance ahead of admin at 39 per cent.
• 57 per cent of respondents chose time constraints (doing everything yourself) as the biggest challenge to growing a business ahead of not being able to hire the right staff (24 per cent).

June 14 A new survey among more than 100 founders of London tech startups, conducted by Studio Graphene in partnership with City RoadCommunications, has revealed the main staffing challenges and concerns that are holding back London tech companies. It found:
• 33% of the founders believe there is a shortage of skilled tech workers in London
• Worryingly, 30% also say their growth has been hampered as a result of them not being able to hire the right employees
• Finding people who fit the startup culture was also cited as a major issue:
◦ 39% of founders of London tech businesses say it is hard to find people who have the right mind-set and work ethic to be employed in a startup

June 12 Temenos
Latin American banks are racing to deliver digital banking to the masses says report released today by Temenos
• Regional change is driven by changing customer behaviour and demands according to 55% of banking survey respondents
• Latin American banks see a bigger impact coming from new entrants than their peers in the rest of the world (48% vs. 36% globally)
• For established banks, new payment players are the biggest threat according to 51% of respondents, followed by neo-banks (23%)
• Survey respondents think that in-house innovation centres (51%), accelerator/ incubator programs (48%), and creating closed bank hubs (48%) are the best way to innovate

June 11 Extend’s Millennials Report Shows Only 11% Of Millennials Have A Business Credit Card From Their Employer
The survey also found that nearly 25% of participants borrow a colleagues’ business credit card to make business purchases

• 44% buy travel, 55% food and car services, 56% business supplies or online services, and 24% pay for invoices (eg, marketing services, online research, conferences, etc.)
• 39% spend more than $500 a month on business expenses that are ultimately paid by their employer
• 30% find it difficult to have access to a mean of payment from their employer
• 25% borrow a business credit card from colleagues to make these business purchases while 67% use their personal credit card and then get reimbursed

May 2018 GlobalData

– 52.3% of global HNW investors reside in North America, but growth is more pronounced in Latin America, where the number of HNW individuals is forecast to grow by 48% between 2017 and 2021.
– Professionals make up 5 million individuals of the global HNW market, 4.8 million being entrepreneurs.
– 28.3% of HNW clients have been acquired through client referrals, making it the most successful channel.
– A longstanding advisor relationship is the most effective means of client retention, followed by portfolio performance and a firm’s brand image.


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SAS Beefs Up Cyber Protection With New Fraud and Security Unit

SAS has created a new global Fraud and Security Intelligence Division to help organizations better detect and combat threats from fraudsters and hackers. The division will further focus and sharpen the SAS efforts to combat fraud and cybersecurity threats. The Association of Certified Fraud Examiners estimates that the typical organization loses 5 percent of annual revenues to fraud, equating to trillions of dollars in losses worldwide each year.

SAS already has more than 400 employees in 25 countries across the Americas, Europe and Asia focused on this area and it plans to add 100 employees to the division over three years. According to PwC’s 2018 Global Economic Crime and Fraud Survey, 49% of companies say they’ve been victims of fraud and economic crime in the last two years – up from 36% the year before.

Stu Bradley will lead the new SAS division as vice president of fraud and security intelligence; the division has 250 people and plans to add another 100. Most recently the SAS vice president of cybersecurity solutions, Bradley has 20 years’ industry experience fighting fraud and abuse, the last nine at SAS.

“Over the last 15 years, SAS has built a reputation as the leader in fraud and security intelligence,” said Bradley. “The rise of the digital economy has been matched by the rapid spread of fraud and cybersecurity risks, making now an ideal time for SAS to redouble and refocus its leadership in this area. We want to meet customers where they are in their analytics journeys, particularly as they adopt technologies like AI, IoT and cloud. With SAS to help them, they will be even better equipped to break down data silos, adjust to shifting regulations, and safeguard against present and future risks.”

One of the great challenges in fighting fraud developing the intelligence and analytics to avoid false positives that can annoy customers and lead to loss of their business. SAS says that banks need a strategy and the right technology to manage risk while providing the service customers expect.

For Landsbankinn, the largest bank in Iceland, finding the balance between providing service for its 120,000 customers and screening transactions for suspicious activity is crucial for its compliance staff.

“Landsbankinn seeks to fulfill the strictest requirements regarding money laundering, criminal financing and other illegal activities,” says Thordur Orlygsson, chief compliance officer for Landsbankinn. “And to meet those demands, we need to have a sophisticated and robust solution.”

The company chose SAS®Anti-Money Laundering to identify patterns in its data. Landsbankinn also uses SAS Visual Analytics to provide data visualization capabilities for analysts across the organization.

While a vast majority of the transactions Landsbankinn processes won’t trigger any alerts, a handful may point to suspicious activity. That’s where the company’s compliance team comes in.

“It’s not possible for us to look manually at all transactions,” Orlygsson says. “We need a system like SAS to help us do pattern analysis to identify suspicious transactions to be referred for investigation.”
Computers are better than people at analyzing fraud. In e-commerce trails in the U.S., where customers don’t present a card — the transactions are known as CNP for Card Not Present — software like Forter and Radial have proven to accept many more good transactions than well-trained fraud prevention teams.

SAS said its new fraud and security intelligence division will drive greater innovation by bringing together software developers and technology professionals from across the fraud, compliance and security domains.

“SAS customers will benefit from hybrid analytic approaches with embedded machine learning, artificial intelligence (AI) and social network analytics,” the company said in its announcement.

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Consumers Prefer AI Supplemented By Human Interaction

Consumers are more comfortable with AI in healthcare than other industries, according to an SAS survey. Lack of human interaction is the most cited reason for discomfort with artificial intelligence.

While the buzz around artificial intelligence (AI) can seem ominous, consumers are surprisingly comfortable with the technology in healthcare than in banking or retail. The survey found that a lack of human interaction was the top reason respondents cited for feeling uncomfortable with the technology.

Just under half of respondents (47%) were comfortable with companies using AI in business interactions generally, with men (53%) slightly more comfortable than women (43%).

Data privacy is also a concern to those surveyed. Only a third of respondents were at all confident that their personal data used for AI was being stored securely. Those under 40 years of age felt more confident (42%) that their information was protected, versus just 31% of older respondents.

“Consumers feel positively about AI when they believe it s being used for good, ” said David Tareen, marketing manager for AI at SAS. “In this survey, healthcare scenarios were well-received, indicating that respondents were comfortable with a tangible benefit to the technology. Overall, a lack of understanding about what AI is and can do is a significant factor for those who fear it.”

AI technologies that assist physicians in patient care rated well with respondents, even when asked about surgery. Forty-seven percent of those surveyed were comfortable with AI assisting doctors in the operating room . More than half of respondents over age 40 were willing to go under the knife with the help of technology, compared with only 40 percent under age 40. Six in ten participants (61 percent) were comfortable with their doctor using data from wearable devices, such as an Apple Watch or Fitbit, to assess their lifestyle and make recommendations based on that data.

When it comes to dollars and cents, survey respondents were not comfortable with banks using AI to interact with them. Monitoring for fraud and other potential threats was the only exception, with 59% indicating they were comfortable with this use of AI.

Accessing a customer’s credit history to make a credit card recommendation was the least popular among potential real-world uses of AI by banks.

Of the three industries suggested by the survey, AI in retail made consumers most uncomfortable. Only 44% surveyed indicated they were willing to share location information in order to personalize their shopping experience. And only 36 percent were okay using their smart phones to enter and shop in a cashier-free store.

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Celent Seeks Nominations For Model Bank Awards

Dan Latimore, Celent SVP, said that after attending multiple conferences, including Sibos and Money2020 back to back, not to mention Finovate earlier in the autumn conference season, the Celent team remained coherent and was able to define some conclusions.


Now Celent is looking for nominations.

“I’m excited about the initial response to our Model Bank Awards (see below for details on how to submit). Last year we had over 150 submissions, half again as many as 2016, which was itself a record year. Our hypothesis: banks, who’ve historically been very shy about trumpeting their technology successes in any detail, now see that they need to demonstrate to their stakeholders – investors, management, and employees – that they’re being innovative. Winning a Celent Model Bank Award is a great way to do that.

“For 2018, we are again accepting nominations in five categories: Customer Experience, Products, Operations and Risk, Legacy Transformation, and Emerging Innovation , although if you’re not sure where your initiative fits, just take your best guess – we’ll be happy to slot it in appropriately as we assess the nominations.”

Send nominations to Dan through the Celent contact form or Twitter…

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