Managing corporate fraud when "41% is conducted by an insider"

4 August 2014

Simon Ferres

Simon Ferres

Former Consultant

Having spent time looking after various technology divisions of top-tier universal bank, I can see tremendous scope to not only reduce the TCO of the significant and growing number of fraud related control measures within an organisation, but also to provide a platform that allows far greater flexibility and freedom around how fraud can be prevented.

This topic is very timely given the significant focus on cost reduction across Banking. Not to mention the ongoing uphill struggle for Banks to restore their reputations.

Questions that your business might typically need addressing through better Fraud Management?

  • How can we identify fraud before the impact is felt?
  • How do we keep on-top of the ever changing face of fraud?
  • How do we most best use of the resources that we have to detect and investigate fraud?
  • How do we allow our fraud management to run in parallel to our business as usual operations without being disruptive?

Last week I spent some time with Michael Heckner, in SAP’s Centre of Excellence for GRC looking at SAP Fraud Management.   SAP really has donned it’s trench coat and become supersleuth with its latest offering.  So what is SAP Fraud Management? (I’m glad you asked).  It is essentially HANA-based predictive analytics that allows your organisation; prevent, detect, and help resolve the most complex of corporate fraud cases.

My initial impression is that this product has significant potential to supercharge fraud management in your organisation.   Why?  SAP Fraud Management harnesses the power of the HANA platform, combines it with predictive analytics – then puts an intuitive front-end over the top that makes the process of detection and investigation  (dare I say it) almost a pleasure.   The challenge is going to be not the technology limitations (sound familiar – Big Data?) but the ability of your organisation to define and evolve detection logic to catch the fraudsters.

The important question of funding fraud technology

The business case for investment in supercharging your Fraud Management using SAP technology would probably be based around; investing in a functionally agnostic  tool that doesn’t have limitations on scalability (especially data), putting in place a tool/software that can be managed and developed end users without a significant technology development overhead – and perhaps most important – a short payback period through identifying fraud events that your organisation might otherwise have not detected.    The £ impact of course is impossible to predict accurately, but detecting and preventing only a small scale fraud could result in break-even on the investment.

Hopefully this has given you a flavour of what I believe is an excellent application of both the SAP HANA platform and Predictive Analytics technology.  Addressing a very real threat to the ever present and cross-industry focus on cost management.

Bluefin and SAP S/4HANA - welcome to the one horse race