Mike Urban

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As U.S. banking institutions make the EMV migration, fraud will migrate from payments cards to areas such as check and first-party fraud, says Fiserv's Mike Urban. How must institutions prepare?

The more banking institutions do now to enhance their behavioral analytics and monitoring, the better protected they will be as fraud shifts from the payments card channel, Urban explains during this interview with Information Security Media Group.

As U.S. banking institutions prepare to migrate their credit and debit cards from legacy magnetic-stripe technology, which is vulnerable to skimming, to the more secure chip technology that conforms to the Europay, MasterCard, Visa standard, they should expect fraud to shift to other areas, experts such as Urban say.

"I expect to see, and I've heard from other financial institutions, that they are expecting losses will shift, check being an obvious one," says Urban, who serves as director of financial crime portfolio management for core payments and banking services provider Fiserv.

But other areas will see upticks in fraud as well, he warns.

Urban foresees a migration to first-party fraud and synthetic identities as well, and he says institutions need to be prepared to re-think their defenses.

"Financial institutions are going to have to think about how they are monitoring for check [fraud] today," Urban says. "They need to think about who they are onboarding along the way by looking at anomalies."

And those anomalies don't have to indicate nefarious behavior, Urban adds. "Those anomalies could just be somebody who is too perfect in their behavior," which would suggest a synthetic identity.

Fiserv, as one of the leading providers of core banking services to U.S. banks and credit unions, has a holistic perspective of the state of banking and fraud, Urban says. These cross-channel fraud trends are only going to increase, he adds.

Stephanie Fuoco, who oversees card fraud at Fiserv, says card issuers in 2014 must hone their defenses and detection capabilities specific to credit and debit fraud as well.

"Today, the U.S. market is seeing an increase in fraud from not only [card-not-present], but also counterfeit frauds as bordering countries have migrated to EMV," she says. "We have told financial institutions to look at things like their expiration terms," which can help deter card-not-present fraud.

During this interview, Urban and Fuoco discuss:

Why shifting to EMV debit is going to be a headache for U.S. issuers, merchants and processors; Why banking institutions should not lean too heavily on mobile when it comes to their EMV rollouts; Visa's and MasterCard's view of card fraud after the 2015 and 2017 liability shift dates.

Urban, who has more than 18 years of experience in financial crime management, analyzes financial crime issues and trends for Fiserv.

Fuoco is senior sales support consultant for card services for Fiserv, where she leads a team responsible for integrated payment fraud service offerings.