Groups Launch Fraud Sharing Database for Financial Services Firms

A recently filed lawsuit shines a spotlight on the liability retirement plan sponsors and providers could face if a participant’s account is hacked.

To enable financial services companies to better detect and prevent account takeover attempts, LIMRA, LOMA and the Secure Retirement Institute (SRI) launched FraudShare. “We designed FraudShare, in collaboration with 10 leading financial services firms,” says Russell Anderson, head of the LIMRA and LOMA Fraud Prevention Program.

FraudShare is an easy-to-use tool for cross-industry reporting about the types and frequency of account takeover fraud occurring in the life insurance and retirement services industries. The tool is a fraud information clearinghouse and alert system that allows companies to better protect themselves against fraud while providing industry-level reporting of account takeover activity.

FraudShare will enable members to:

• Defend against increasingly sophisticated account takeover schemes;
• Allocate their resources effectively and efficiently by leveraging the collective knowledge of the industry as a whole; and
• Protect their customers, their brands and their balance sheet from fraud.

“According to new LIMRA-Boston Consulting Group research, seven in 10 financial services companies consider fraud a growing concern. Companies report the incidence of account takeover fraud is increasing for individual life insurance and annuity contracts and defined contribution retirement plan accounts. Beyond the tangible damages, such as replenishing customer accounts, and potential fines, legal fees and lawsuits, companies risk losing something even more valuable: consumers’ trust,” Anderson says.

Retirement plan sponsors have a responsibility to look into providers’ practices for protecting participants’ data and accounts.

For more information about FraudShare, or to participate in an interactive demonstration of the tool, visit the FraudShare microsite.