Take On Payments, a blog sponsored by the Retail Payments Risk Forum of the Federal Reserve Bank of Atlanta, is intended to foster dialogue on emerging risks in retail payment systems and enhance collaborative efforts to improve risk detection and mitigation. We encourage your active participation in Take on Payments and look forward to collaborating with you.
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February 23, 2009
Why should I work with you?
At some level, we're all selling something, even if it's just ourselves. Everyone has a reputation and a résumé to build. Information is power. We all have bosses to please, goals to meet. So when and how do these stars align such that we can work together?
Payments is a network industry with chicken-and-egg problems. It requires someone to step forward, perhaps to risk losses, in order to build networks of users and providers that enable a payments network to operate. Think of a simplistic credit card network—users need to know that merchants will accept it, banks need to know that they can make money to provide the lending that backs it, and merchants need to know that they'll be compensated with business in order to justify the costs.
The same dynamics apply to those who are minding the store when it comes to addressing risk and fraud in payments networks. Who's willing to step out (at some risk) to take on the tough challenge of pulling the variety of industry, regulatory, law enforcement, merchant, and consumer interests together? Where's the money to be made? Where's the competitive advantage?
In the best sense, law enforcement is imbued with an altruistic drive to do good by catching the bad guys, and bank supervision is all about ensuring a safe and sound banking system.
In the best sense, payment services providers seek to provide a safe and efficient environment for the exchange of value. But will any service provider risk exposure to reputational and other risks just because it's good for the payment system?
Payments is also an industry that offers opportunities to leverage positive "network effects"—the more users of a payment mechanism make it more valuable for all as it becomes more ubiquitous, commonly understood, and efficient. The same network dynamics should apply to those who are minding the store when it comes to retail payment systems risks.
All these interests and perspectives can align if we are realistic in our approach to interest alignment and continue to collectively look for opportunities of mutual benefit.
Where do you see alignment and opportunity?
By Clifford S. Stanford, assistant vice president and director of the Retail Payments Risk Forum at the Atlanta Fed
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February 2, 2009
Retail Payments Risk and Fraud: Detection and Mitigation
The Retail Payments Risk Forum hosted a conference titled "Risk and Fraud in Retail Payments: Detection and Mitigation" at the Federal Reserve Bank of Atlanta on Oct. 6–7, 2008. This conference provided a collaborative forum to facilitate information sharing among experts and foster improved detection and mitigation of retail payments risks and fraud in check and automated clearinghouse (ACH) payment systems. Experts from banking agencies, state and federal law enforcement, NACHA, the ACH operators, and others explored barriers and discussed opportunities. The meeting leveraged the assembled expertise to identify opportunities for further collaboration.
Three expert panels discussed themes regarding third-party risks in retail payments, enforcement actions, and consumer protection concerns. Participants were then asked to discuss key topics in smaller breakout groups, including information-sharing limitations, policing bad actors, collaborative opportunities, substantive areas of concern, and the role of the Retail Payments Risk Forum.
The proceedings of the conference are summarized in the full-length conference summary, which can be found as text or pdf. We encourage you to review the conference summary and also to provide any comments you may have within Portals and Rails. In particular, we want to know what you thought of the topics addressed. Did the discussions reflect your understanding of the issues? Did we miss anything? What topics would you like to see addressed in future such events? How do we best ensure ongoing collaborative work among industry, regulatory, and law enforcement parties in the detection and mitigation of retail payments risks and fraud? Your thoughts are very valuable to us!
By Clifford S. Stanford, assistant vice president and director of the Retail Payments Risk Forum at the Atlanta Fed.
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Listed below are links to blogs that reference Retail Payments Risk and Fraud: Detection and Mitigation:
- Looking for Partners in Safer Payments
- The Range of Un-Friendly Fraud
- Payments Webinar October 10: Cash in the 21st Century
- "Insuring" Ransomware Will Continue to Flourish
- Designing Disclosures to Be Read
- Is There a Generation Gap in Cash Use?
- What the Most Convenient Food Tells Us about Payments
- Is Friction in Payments Always Bad?
- Why Should You Care about PSD2?
- At the Intersection of FinTech and Financial Inclusion
- October 2019
- September 2019
- August 2019
- July 2019
- June 2019
- May 2019
- April 2019
- March 2019
- February 2019
- January 2019
- account takeovers
- ATM fraud
- bank supervision
- banking regulations
- banks and banking
- card networks
- check fraud
- consumer fraud
- consumer protection
- credit cards
- cross-border wires
- data security
- debit cards
- emerging payments
- financial services
- financial technology
- identity theft
- law enforcement
- mobile banking
- mobile money transfer
- mobile network operator (MNO)
- mobile payments
- money laundering
- money services business (MSB)
- online banking fraud
- online retail
- Payment Services Directive
- payments fraud
- payments innovation
- payments risk
- payments study
- payments systems
- phone fraud
- remotely created checks
- risk management
- Section 1073
- skills gap
- social networks
- third-party service provider
- trusted service manager
- Unfair and Deceptive Acts and Practices (UDAP)
- wire transfer fraud
- workforce development
- workplace fraud