Today, Paul Benda, executive vice president of risk, fraud and cybersecurity at the American Bankers Association, will testify before the House Financial Services Subcommittee on Oversight and Investigations during a hearing focused on fraud and the threat it poses to American families.
In his prepared testimony, Benda highlighted the alarming rise in financial fraud targeting American consumers and businesses, emphasizing the need for a coordinated, multi-sector response to combat increasingly sophisticated criminal tactics.
“Banks are working every day to protect their customers from fraud by investing in new technologies, deploying public relations campaigns to educate consumers and small businesses about old and new scams, and partnering with law enforcement and other federal agencies on new initiatives to combat fraud,” Benda said. “Yet our industry recognizes that there is more work to do, and banks cannot stop criminals by themselves. Every player in the fraud ecosystem must play a role; from the telecommunications firms to the social media companies to the Postal Service.”
In his testimony, Benda called for the creation of a national strategy to prevent fraud and scams, including the establishment of an Office of Scam and Fraud Prevention within the Executive Office of the President. He also urged Congress and regulators to:
- Close loopholes that enable impersonation scams via spoofed caller IDs and fake social media accounts.
- Enhance collaboration with law enforcement and regulators to improve fraud detection and prosecution.
- Improve real-time fraud information sharing across industries and government agencies.
- Continue to enhance bank anti-fraud operations to ensure they match the sophistication of modern fraud, including interbank recovery mechanisms and customer experience in fraud resolution.
- Support consumer education campaigns to empower individuals against scams.
Benda highlighted ABA’s partnerships with the U.S. Postal Inspection Service and law enforcement agencies to combat check fraud, which has surged since the pandemic. He noted that ABA’s industry-wide consumer education initiatives, including the #BanksNeverAskThat and #PracticeSafeChecks campaigns, have reached millions of Americans with practical fraud prevention tips.
“Banks are committed to protecting their customers’ data and money,” Benda said. “Our goal is to provide a safe and sound financial system that allows our customers to achieve their financial goals. Banks spend billions of dollars a year on cyber security and anti-fraud measures to provide one of the most secure banking systems in the world, but banks cannot do it alone.”