Data key to early identification of fraud risks

The quantity of data being created by companies and individuals is growing at an exponentially rapid rate and the signs are there that this trend will continue. Manual review of these significantly large volumes of transactional data is costly and makes it extremely difficult to identify indicators of fraud on a timely basis. Equally, sample testing across vast tracks of data has its shortcomings as the full effect of frauds cannot be accurately measured and smaller anomalies that can grow into more serious matters over time can be missed. Similarly, internal controls in isolation, no matter how robust, are no longer adequate as fraudsters find innovative ways to circumvent them.

With contemporary fraud risk data analysis, organisations receive a quick overview of their business operations presented in visual interactive dashboards that can used to quickly and easily drill down into details. This makes proactive analysis much faster, more detailed, and more comprehensive than manual processes leading to increased awareness of fraud risks.

Advances in business analytics makes it possible to examine enormous amounts of data to uncover patterns, relationships, correlations, anomalies and other insights. Business analytics solutions automatically search 100% of transactions for fraud indicators and has the benefit of being able to merge, normalise and compare data from different systems either internal or external to the company. This allows risk management leaders to quickly prevent the consequences of fraud by amending controls and behaviours before risks turn into problems. In so doing, management can realign resources to focus on detection efforts and save time by automating repetitive tests. Adding in a layer of continuous monitoring provides virtually real-time awareness through automated testing, risk identification and notification workflows for remediation.

It goes without saying, the longer fraud goes undetected, the more costly it becomes. By enabling well designed business analytics solutions business leaders proactively increase awareness to fraud risks which has the potential to decrease the number of incidents translating into improved stakeholder confidence.