Ready for FFIEC

A new report from Boston-based Aite Group shows that the financial services industry is geared up for the Federal Financial Institutions Examination Council's (FFIEC) end-of-year deadline for outlining a plan for stronger online authentication.

Aite surveyed the top 10 retail brokerages and 12 of the top 50 U.S. banks and found that 92 percent already have selected vendors for user-authentication, fraud-detection and transaction-monitoring solutions. Aite notes that fraud- detection and transaction-monitoring capabilities currently yield a lower satisfaction rate (40 percent) than user authentication products (75 percent).

Over the next 12 months, Aite says, it expects that half of the industry's large firms will have advanced fraud-detection and fraud-monitoring capabilities, such as real-time transaction analysis, by way of vendor solutions, while 8 percent will build that functionality in-house. One quarter of the industry still will have only basic fraud-detection capabilities from technology providers, and as much as 17 percent of the industry will have no automated fraud detection whatsoever, according to the report. <<<