Clari5 Market Insights
MALAYSIA
Bank Negara Malaysia
New Measures to Combat Financial Scams in Internet & Mobile Banking
Malaysia Central Bank, BNM Announces New Measures to Combat Financial Scams
By when must banks comply with the mandate?
With immediate effect.
Why has BNM issued the new mandate?
Fraud risk is constantly evolving. Scammers are finding new ways to defraud the public including tricking bank account holders into revealing their banking details or installing malware on their devices. Of late, scams and cybercrimes such as online sales scams, online trading scams, African scams, Macau scams, BEC scams, fake loans and SMS scams have been on the rise. The number of such scams increased from 13, 703 (Losses- RM539 million) in 2019 to more than 12,000 cases between January and July 2022 (Losses- RM400 million). BNM therefore stepped-up efforts to combat financial scams and collaborate with other stakeholders.
Highlights of the mandate
BNM has announced five additional security measures for FIs to strengthen safeguards against financial scams especially in Internet and mobile banking services.
- FIs are required to migrate from SMS One Time Passwords (OTP) to more secure forms of authentication for online activities / transactions.
- FIs will further tighten fraud detection rules and triggers for blocking suspected scam transactions.
- A cooling-off period will be observed for the first-time enrolment of online banking services or secure devices. During this time, no online banking activity is allowed to be conducted.
- Customers will be restricted to one mobile or secure device for the authentication of online banking transactions.
- FIs will be required to set up dedicated hotlines for customers to report financial scam incidents. FIs have to be more responsive to scam reports lodged by customers and facilitate efforts to recover and protect stolen funds, including to work with relevant agencies to prevent further losses.
How Clari5 helps FIs in Malaysia quickly comply with BNM’s mandates
Highlights
Advantages
Highlights
- Enterprise-wide, real-time automated fraud monitoring / detection for all transactions across products, channels, branches, accounts
- Transaction blocking / holding and alert generation for suspicious transactions in real-time, based on defined parameters
- Configure new scenarios and modify existing scenarios to combat emerging fraud patterns and risks, however sophisticated
- Behavior profiling based on emerging fraud patterns covering all channels and products across the bank, by synthesizing intelligence from multiple source systems and databases
- Easily handle high throughput digital channels for transaction surges upwards of 2000 transactions / second
- Built-in adapters for seamless integration with various banking systems
- AML compliance solution that can be easily integrated with Clari5 Fraud Management System
Advantages
- Unified FMS at FI Level covering both AML and fraud risk mitigation across digital and physical channels, across all products and services
- Real-time decisions at scale enables true real-time prevention for in-flight transactions, constructs 360º view of the customer, in real-time, powered by customer behavioral profiling as base, based on transaction history
- Case Management System to shrink analyst time on false positive investigation, using AI / ML driven models on past resolution data; workflow-driven investigation in a configurable centralized or decentralized manner
- Extensive library of rule-based scenarios covering all products & channels reflecting years of real-life experience across 25+ geographies; authoring tool to modify / add to this library
- Parallel use of AI / ML tools and graph analytics to extract new patterns, deploy them for better detection rates with lower false positives
- Real-time customer intelligence that can be leveraged for in-stream product / service up-sell, cross-sell, next best offer