Many people think of fraud as a problem that mainly impacts large financial institutions, but smaller community banks face many of the same issues and must adhere to the same strict regulatory requirements. All banks must combat technologically sophisticated criminals who find new ways to manipulate the system for their own personal gain.
Fraudsters target smaller banks, assuming these institutions neglect fraud prevention and lack the technology to detect sophisticated financial crimes. However, these assumptions prove increasingly outdated.
Jump to ↓
| Facing big-bank challenges |
| The switch to CLEAR |
| Keeping up with new scam tactics |
| One tool, many uses |
| Building trust, one search at a time |
Facing big-bank challenges
For example, one family-owned bank that has been serving its community for more than 150 years strengthened its fraud-detection capabilities by integrating new technology. They switched to Thomson Reuters CLEAR investigative software to conduct due diligence, identify suspicious financial activity, and assist in investigations. The bank now protects itself and its customers from financial risk and fraud with confidence, but that wasn’t always the case.
Recently, this mid-size bank faced multiple big-bank challenges head-on. Fraudsters attacked their customers through romance scams, lottery schemes, elder exploitation, identity theft, and numerous other fraud tactics. The bank’s investigative caseload exploded, overwhelming an already stretched staff. Individual investigations consumed excessive time while cases accumulated rapidly.
Simultaneously, this bank—like all financial institutions—wrestled with strict new Bank Secrecy Act reporting requirements and faced demands to share information with other financial institutions under Section 314(b) of the USA Patriot Act.
Something had to change.
The switch to CLEAR
The switch to Thomson Reuters CLEAR was a game-changer.
Due-diligence investigations that once took hours could be completed in minutes, and basic identity checks were done in seconds. Additionally, CLEAR’s search results were far more comprehensive and cost-effective than the bank’s previous methods, which heavily relied on free search engines like Google and Bing.
CLEAR gathers data from diverse public and proprietary sources — court filings, property records, licensing agencies, and more — then presents search results in an instantly understandable format. Quick Analysis Flags identify key details and link directly to supporting documentation. The Risk Analysis Summary delivers investigators a concise verbal analysis of a subject’s business history and flags potential risk factors that demand attention.
The additional speed and accuracy gained using CLEAR has made it possible for bank employees to conduct more investigative work in less time, without the need for any additional resources. These time savings made the bank’s standard onboarding processes efficient, allowing staff to pursue deeper investigations when necessary.
Keeping up with new scam tactics
CLEAR also helps banks of all sizes keep up with fraudsters who are constantly inventing new scams and tactics, many of which involve sophisticated technological tools. Indeed, CLEAR’s proprietary databases are continuously revised to reflect the latest trends in criminal activity, including updated lists for sanctioned entities, denied parties, and suspected money-launderers.
One tool, many uses
By adopting CLEAR, this community bank has transformed its due-diligence practices and improved both the effectiveness and efficiency of its overall risk-management operations. Compliance with enhanced due-diligence (EDD) protocols and BSA/AML requirements is no longer an issue either, because CLEAR’s customizable toolset makes it easy to record, analyze, and report suspicious financial activity to authorities.
Now that CLEAR has been fully incorporated into its workflows, the bank uses CLEAR to:
- screen new customers: Know Your Customer (KYC) and Customer Due Diligence (CDD)
- conduct enhanced due diligence (EDD)
- verify individual identities
- verify business ownership and contact information
- verify property ownership status (e.g., real estate, vehicles, equipment)
- cross-reference watch lists and criminal histories
- identify potential criminal associations
- identify other onboarding risks (e.g., bankruptcies, liens, lawsuits, etc.)
- protect against synthetic identities, identity fraud, and account takeovers
- flag customers mentioned in negative news or other adverse media
- monitor high-risk accounts
- identify suspicious financial transactions
- help prepare suspicious activity reports (SARs) and other compliance documentation
Building trust, one search at a time
There are other investigative tools on the market, but none as powerful or cost-effective as Thomson Reuters CLEAR. For a bank’s analysts and investigators, CLEAR eliminates the guesswork involved in risk assessment and provides reliable results that help maintain the customer loyalty and trust upon which all financial institutions depend.
To find out more about how a small, family-owned community bank is using Thomson Reuters Risk & Fraud Solutions to protect against financial crime, download the case study, “Delivering anti-fraud intelligence in seconds.”
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