Financial Firms, Cyberfraud and Fines: Is Big Data the Investigation Solution?

Financial Firms, Cyberfraud and Fines: Is Big Data the Investigation Solution?

From celebrity social media accounts to elections, concerns about cybersecurity and fraud are universal in our era - for good reason. A study conducted by McAfee and Intel estimated that the global losses from cybercrime total between $375 billion and $575 billion annually.

This problem is especially challenging for financial firms, as threats come in two forms: both internal and external actors. Add in the data-rich aspect of this industry, and catching cyber criminals and rogue employees becomes much more difficult. It entails sifting through massive data sets, which can stall investigations in their tracks.

Finance in the digital crosshairs

Even the largest financial companies struggle with this challenge. Last year, Morgan Stanley was hit with a $1 million fine from the Securities and Exchange Commission for failing to properly secure customer data, as it didn’t prevent an employee from transferring hundreds of thousands of customer accounts and associated data to their personal computer. That computer was subsequently hacked, leading to a massive breach of confidential investor information.

The massive concentration of consumer or investor data is one of the factors that makes the financial industry such a lucrative target for criminals, both because it’s possible to hide within the noise and because many usernames, passwords or other information represent a valuable asset all on their own. For financial firms, the average cost of a single lost record is $221, compared to an average of $158 per record across all industries, according to the Ponemon Institute.

Using big data to combat fraud and cybercrime

The financial sector has been cracking down on fraud and cybercrime. Eight of the largest banks in the U.S. joined forces last year to deal collectively with the threat posed by cyber criminals seeking to cut through their firewalls or swipe credentials with a well-placed email. Financial institutions of all sizes have been targeted, of course, but these mega-banks face a particular set of risks.

“They are trying to provide a support mechanism for deeper information-sharing and collaboration on top of whatever is already going on today,” John Carlson, vice chairman of the financial sector coordinating counsel at Financial Services Information Sharing and Analysis Center, told the Wall Street Journal.

For internal investigators and cybersecurity professionals, the sheer quantity of data now available represents both an asset and a liability. On the one hand, we can now see with unprecedented resolution exactly when, where and how someone accessed certain systems and portals. The breadcrumb trail of login attempts, IP addresses and other metadata provide astonishingly effective ways to track fraud and hacking - if you’re able to line them up.

There are ways to tackle this problem head-on and use data as an asset that helps conclude fraud investigations successfully. With the Visallo platform, investigators can dive into complex sets of big data and extract the key insights they need. By employing pathfinding and data clustering techniques, Visallo is able to piece together interactions between different users, locations, platforms and more to locate the source and cause of a serious breach or fraudulent transaction.

Visallo also offers powerful tools for collaborative work, while ensuring that access to each individual dataset or visualization is limited to exactly the people who need it, and no more. With the sophisticated strength of Visallo, financial fraud becomes an easier target for thorough investigations.