Stop the Fraud and Keep Your Bottom Line


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IBM Case Manager and Fraud Prevention across Industries

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Stop the Fraud and Keep Your Bottom Line

  1. 1. Stop the Fraud and Keep Your Bottom Line IBM Case Manager and Fraud Prevention across Industries 1
  2. 2. Many Challenges Facing The IndustryThe risks of not assimilating TRUSTinformation - Has the industry Become a trusted advisor to clients to support future client growth and so gaincrossed the line and needs to retool its cross and up-sell opportunitiessurveillance and Fraud Investigations Trust also in the form of transparency and being viewed as financially solid COMPETITION Information REGULATION Competition is intensifying Radically increased with all competitors currently Explosion oversight is ushering in a engaged in looking how to new era of regulatory better support client and requirements - Dodd/Frank monetize their transactional data CLIENT’S NEEDS CAPITALISATION Clients have rapidly evolving expectations for offerings and services, unbiased advice, £ Mature market segments and emerging market segments alike focus on rebuilding their and convenience capital reserves and managing their liquidity – Basel 111- stress test 1 – Source: IBM Institute for Business Value/ Economist intelligence unit, business analytics survey 2010
  3. 3. Organizations drive transformation by starting withone of these four high-value initiatives Examples: 1 Grow, retain and satisfy customers • Churn management • Social media sentiment analysis • Propensity to buy/Next best action 2 • Predictive maintenance Increase operational • Supply chain optimization efficiency • Claims optimization 3 • Rolling plan, forecast and budget Transform financial • Financial close process automation processes • Real-time dashboards • Operational and financial risk visibility 4 Manage risk, fraud & • Policy and compliance simplification regulatory compliance • Real-time Fraud identification and investigation
  4. 4. How much is spent trying to eliminate fraud? IDC FI Estimates $3B Spending on Financial Crime with 8.3% CAGR P&C fraudulent payouts in excess of US $30 Billion (US) £1.9 billion annually in undetected claims fraud (Britain) PLUS: Instances of cross-channel fraud (for example, one fraud case that exploits the Web and the phone channel) in banking, insurance and other sectors continue to rise worldwide. While there are no official government statistics, industry estimates for just U.S. Medicare fraud put the amount at more than $50 billion a year. Bank account takeover is also a major global issue with the proliferation of Zeus, SpyEye and other malware. Gartner estimates that small business account takeovers in the U.S. alone have already led to at least $3 billion in losses.
  5. 5. Significant Progress Has Been Made WithRespect To The Management Of Data What How long How and What needs to When and information do should I keep where should be to how will I get I have? it? I keep it? retained? rid of it?This scenario deals with Here the scenario The capabilities of this This is the scenario of This is the scenario ofInformation Discovery focuses on the scenario deal with eDiscovery Defensible Disposal,capabilities that Records Management Smart Archiving Management, dealing where IT, Recordscapture, identify, capabilities for data optimizing and unifying with legal compliance Managers, Legal &categorize, classify, quality & reliability, content archiving with and litigation matters to Business Stakeholdersqualify & assign the single entity identifiers, common collection & avoid excessive costs apply sustainable value-proper taxonomy and value based retention classification and risks inherent in based informationlineage to structured & policies, taxonomy technologies within a reactively responding to lifecycle policies tounstructured data management and flexible & secure compliance and retain what is valuablegathered & maintained auditable retention, infrastructure litigation challenges & dispose of what is notby the enterprise access entitlement, PII security and compliance Discover DisposeCatalog Archive Retain 5 But What About Using This Data To Make Better Decision?
  6. 6. Enterprise Content Management (ECM) -Eliminating The Inefficiency Of Paper Based AndManual Business Processes ECM Traditional Solutions • For more than 25 years the finance Mortgage Commercial Industry has implemented ECM lending lending solutions Consumer Student lending lending Business Applications – Account opening – Lending origination – Trust document management Claims Underwriting – Records management – Information lifecycle management – Content centric workflow processes – Archiving – E-mail management Fraud and illegal Wealth transactions Compelling ROI & benefits: management – Reduced cycle times – Reduced FTE costs Wholesale banking Credit card processing – Improved customer experience New account opening – Improved compliance – Reduce errors and Fraud
  7. 7. When It Comes To Gaining A Complete View - How IsIndustry In General Doing? • 77% of CEOs say they do not have real- time information to make key business decisions • 1 in 3 business leaders frequently make business decisions based on information they don’t have, or don’t trust • 1 in 2 business leaders say they don’t have access to the information they need to do their jobs!!! Companies that invest in business insight outperform their peers, showing 33% higher revenue growth, 12 times more profit growth, and 32% higher return on invested capital. Sources: IBM CEO & CFO Studies, IBM Business Analytics and Optimization Study
  8. 8. Significant IBM Technology Investments To HelpIts Clients Capitalize On Their Information Assets • More than $15/16B in Software 2012 Acquisitions Since 2005 i2 • More than 10,000 Technical Analytic Data Warehouse Appliance Professionals Social Analytics/Consumer Insight • More than 7,500 Dedicated Workload Optimized Systems Consultants Advanced Case Management Content Analytics • Largest Math Department Decision Management in Private Industry Stream Computing • More than 27,000 Business Pervasive Content Partner Certifications pureScale pureXML Deep Compression Developer Productivity Autonomic Operations 2005
  9. 9. IBM Content Analytics Is A Powerful Platform ToDerive Rapid Insight Transform raw information into business insight quickly without Rapidly Derived Insight building models or deploying complex systems. Search Derive insight in hours or days … and Explore not weeks or months. Analyze Easy to use for all knowledge and Visualize workers to search and explore content. Aggregate and Extract Flexible and extensible for deeper insights. External and Internal Content (and Data) Sources including Social Media and More 9 Watson
  10. 10. Why shouldnt all important decision makingprocess be managed as a case? Advanced Case Management Case Design Case Runtime Case Analytics Structured Unstructured Models Templates Solutions Context 360o View History Real time Persisted Case Infrastructure Case Object Solution Task Object Case Analytics Case APIs Models Constructs Model Data Store Content Collaboration Workflow Rules Events Integration Monitoring & & Social SW Analytics people process information 10
  11. 11. Connecting the dots? Web All have surveillance Content Content analytics - look for output patterns, connect the dots Social Media Sites “complete view of the customer” Third parties credit reporting Multiple Case management systems Structured and unstructured content – customer information Retail High Volume • E-mails New level of Surveillance of • Correspondence Intelligence transactional data • Fax • Checking • Video • Card • Voice • ATM • Photos Multiple CRM & Helpdesk logs • Funds Transfer • Biometrics • lending • Trust • Bonds • 401K Capture, data governance & quality • Investments consolidation, search, discover & analytics
  12. 12. What concerns you most? 1. Cross channel fraud 2. Insider fraud (or “asset protection”) 3. Money laundering schemes 4. Malware and phishing on fixed and mobile networks 5. Credit card fraud / white plastic / ATM & POS skimming 6. ACH and wire transfer fraud 7. Securities and stock fraud 8. Compliance issues 9. Acquire and analyze data from social networks 10.Access intelligence on individuals and groups that may pose a threat to your facilities or personnel
  13. 13. Traditional channel-based monitoring has lead tooverly complex data, detection & case managementsystems • Higher Technology Costs and Lower Responsiveness • Reduced Ability to Prevent, Monitor, and Investigate Fraud • Lack of Timely, Actionable Intelligence for Enterprise-Level Management Investigative Units Enterprise Functions LOB 1 Team Audit LOB 2 Team Legal LOB 3 Team Enterprise Risk LOB 4 Team 13
  14. 14. Integrated Fraud Strategy – make decisions andact upon insights Data Discovery Investigate Report Gather all data Determine predictive Act upon Insights Show Business outcomes Impact Process LOB Transaction IBM SPSS Predictive Models Deploy Automated pattern analysis, Case Management IBM Cognos likelihood of threat Initiate and manage OptimizeData Sources workflow, rules and Leverage Recommendations management of fraud cases structured and unstructured data Business Rules New Make expert knowledge explicit Patterns Identity Insight Content Analytics Entity extraction & normalization from unstructured data Investigation Reporting Visual and forensic analysis and Documentation • Conduct ad-hoc analysis to understand • Initiate and manage workflow, • Create and deploy easy-to-understand data, analyze trends, forecast, and plan rules and management of reports, dashboards, and scorecards to drive accurate conclusions fraud cases • View information with real-time • Utilize predictive models to analyze • Investigate identified threats monitoring to make decisions in real- patterns, determine future outcomes with powerful visual analysis of time and prescribe interventions based on complex data • Leverage planning and budgeting tools business rules • Create and deploy visuals with to improve process efficiency • Extract and normalize entities, facts & link and social network analysis Identity concepts from unstructured data • Leverage federated search Insight • Explore complex relationships • Investigation reporting
  15. 15. The Response: An Integrated Fraud StrategyAn integrated fraud strategy removes delays and blindspots, thus reducing losses Siloed Approach Integrated Fraud Benefit Technology Higher Technology Costs and Lower Reduced Complexity Responsiveness • Increased Efficiency and cost savings • Inflated hardware, software, storage and • Streamlined data architecture maintenance costs • Single operational environment • Something is always broken Prevention and Reduced Ability to Prevent, Monitor, and Move from Detective to Preventative Controls Investigate Fraud • Ability to create a baseline fraud score across Detection • No visibility across channels for a single client channels and LOBs view • Improved business intelligence via optimized • No capability to perform cross-channel analytics leveraging more data analytics • Consistent & coordinated customer contact Enterprise Fraud Enterprise-Level Management is an Uphill Empowered, Informed Decision Making Battle • Consistent, repeatable investigative process Management • Costly latency in managerial visibility due to • Business process automation labor-intensive data collection and reporting • Trusted view, on-time, without the noise • Multiple communication channels yield unreliable performance and add points of • Faster responsiveness to emerging fraud failure patterns • Pro-active Transformation is blocked
  16. 16. IBM Content Analytics adds value in the fightagainst fraud and reputation damage Regulatory Compliance • Analyzing: new regulations and alerting the Crime Analytics responsible party. Flagging inconsistencies, errors • Analyzing: Case files, for crime or omissions trend patterns to reduce future case • Benefits: Improve compliance with new and volumes due to ineffective LOB business processes existing regulations avoiding supervision & fines • Benefits: crime Interdiction avoid loss of reputation and costs Fraud • Analyzing: claims, disputes and complaints Marketing • For: Detecting fraudulent activity & patterns • Analyzing: Call center notes, multiple in all channels – but in particular inbound and content repositories, email files Social Media outbound social network messages • For: churn prediction, product/brand quality • Benefits: Reduced losses, faster detection, • Benefits: Improve consumer satisfaction, gaining control of new communications from marketing campaigns, find new revenue the outset – avoid adverse publicity opportunities or product/brand quality issues