HSBC uses SAS Business analytics

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See how HSBC uses SAS for Fraud Prevention as a part of their Enterprise Risk Management Strategy

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HSBC uses SAS Business analytics

  1. 1. Fraud prevention as part of an Enterprise Risk Management Strategy Derek Wylde Head of Group Fraud Risk HSBC
  2. 2. A word on HSBC Customers Total Assets Profit Before tax (end 2008) 2008 100m US$2,527bn US$9.3bn International Offices Employees Network Worldwide 86 countries and 10,000 320,000 territories
  3. 3. Fraud trends • Card fraud continues to rise despite chip • Serious information risk issues and events • On-line fraud threat ever present and rising • Internal fraud rising • First party fraud rising • Organised crime heavily involved
  4. 4. Global Credit Card Fraud Trends $m 3000 2500 2000 1500 1000 500 0 2002 2003 2004 2005 2006 2007 2008
  5. 5. Global fraud as percentage of sales 12 10 8 bps 6 4 2 0 2002 2003 2004 2005 2006 2007 2008
  6. 6. Global Plastic Card Fraud Losses 2003 2008 L&S 4% 6% 3% 3%4% 4% Counterfeit 23% 33% CNP 21% Apps 33% NRI 30% ATO 36%
  7. 7. Global CNP Fraud Losses 2002-2008 900 800 700 600 $ Millions 500 823 400 637 300 200 100 0 2002 2003 2004 2005 2006 2007 2008
  8. 8. Phishers are still in business Unique phishing sites detected - 2008 (Source: Anti-Phishing Working Group) 40,000 36002 35,000 30,000 27209 27739 26303 24908 25,000 21507 20305 20410 20317 19480 20,000 18509 15709 15,000 10,000 5,000 0 Nov Jan Jun Jul Mar Apr Feb Aug Sep Oct May Dec
  9. 9. Start with a laugh… • P.C. Vey, Published by the New Yorker, January 16th, 2006
  10. 10. Anti-fraud strategy • Fraud prevention controls • EMV (chip) for face to face card transactions • Remote card authentication (CAP) for CNP • Strong customer authentication – dynamic password • State of the art anti-fraud technology • Advanced analytics • Data sharing
  11. 11. Anti-fraud technology • Application screening • Transaction monitoring • Internal staff activity monitoring • Layered security framework • Advanced analytics • Data sharing
  12. 12. SAS Fraud Management • HSBC required a fraud detection for the 21st century 100% real time Advanced multiple models Unlimited rules Champion challenger functionality User friendly case management Ease of deployment IT efficient Global deal Global support Vendor partnership Support for enterprise fraud management
  13. 13. HSBC Progress • First implementation in US – June 2007 • Strict performance criteria set and met • Now live in 12 businesses in 9 countries • SAS FM protects 80% HSBC issued cards • Plan for a further 26 deployments covering 16 businesses in 15 countries
  14. 14. The Enterprise Vision FM 1 FM 2 FM 3 FM 4 Raptor 1 (fraud detection for credit and debit cards) Raptor 2 (fraud detection for all personal products) Leverage (for credit risk) Leverage (for marketing)
  15. 15. SAS Fraud Management will be at the heart of Fraud decisioning • Application scores from screening solutions • On-line authentication results • 100% real time transaction scores • First party fraud scores • Internal staff fraud monitoring
  16. 16. SAS as a partner… • Committed • Responsive • Innovative • Flexible • Nice people to do business with
  17. 17. Fraud prevention as part of an Enterprise Risk Management Strategy Derek Wylde Head of Group Fraud Risk HSBC

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