Tool helps bank fight fraud

04:43, Jul 10 2009

Westpac has a new tool in the war against fraud after investing in software designed to check each of the 1.6 million transactions it processes each day to decide if there is anything suspicious.

Each time a customer gets out a debit or credit card or makes an online banking transaction, Proactive Risk Manager, supplied by United States firm ACI, can check up to 800 aspects of the transaction to determine whether anything might be awry.

Its decisions are based on rules that the bank can set and change to reflect changing fraud patterns.

ACI account manager Allison Aldred says Westpac will join ANZ National Bank in using Proactive Risk Manager to check transactions in "real time". That means that if a suspicious transaction is picked up, it can be blocked before it is completed.

Westpac says it is only using the software for credit card transactions at present, but Ms Aldred says it will be used to monitor all transactions and could then consider all aspects of customers' past behaviour.

"If there is a customer that has just used their debit card in Christchurch and all of a sudden there is a transaction that comes in from Bahrain on their credit card, the system will detect that is an anomaly.


"If you have a customer that does their weekly shopping on their card and then fills up with petrol, but the transactions are never more than $200 and they do a $2000 transaction at a jewellery store, that would be alerted, because it would not be within the customer's profile.

"An alert will go to a business analyst, they will have a look at it, and they can give the customer a call or send them a text message."

Ms Aldred says the deal with Westpac is significant as it is the first time a bank has implemented the software on an IBM System z mainframe since ACI and IBM formed an alliance in 2007.

Westpac head of fraud and security services Terry Mortensen says the software alerted the bank to an attempted fraud within a few days of going live.

Last year, National Australia Bank used ACI's software to identify fraud against customers of an online flower merchant.

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