When a company confirms a data breach, this security event can cause ripples in the economy. Not only do the companies that experience the breach have to content with its financial impact, but the payment industry tied to these firms is also particularly hit hard. Facing huge monetary losses from cyberattacks that exposed millions of customers' information, banks and other financial institutions are now guarding against the impact of identity theft and data breaches with the help of biometrics, The Associated Press reported.
As cybercriminals are infiltrating sensitive corporate systems and using both high- and low-tech methods for identity theft, banks are now ramping up their use of technological solutions like biometrics to fight fire with fire. The AP report highlighted the growing use of speaker recognition among banks to detect fraudsters and protect consumers.
The software developed by anti-fraud companies can screen callers during calls to banks and match their voices to databases of potential identity thieves. These suspected criminals may contact banks posing as legitimate customers to obtain new credit cards or steal personal information.
The use of voice-based biometrics is also implemented in the public sector to increase organizations' ability to prevent fraud, according to the AP.
Cyberattacks Result in Monetary Losses
While investments toward biometrics and more advanced payment cards will likely cost millions of dollars, banks and financial institutions face even greater losses if they do not step up their battle against cybercriminals. After an attack against Target exposed the information of 40 million credit and debit cards, banks were forced to reissue huge volumes of cards and reimburse customers for fraudulent purchases. In giving customers new cards, financial institutions protect consumers from fraudulent purchases if cybercriminals sell the financial information on the black market. These payment card records are typically worthless to thieves once a new card is issued.
However, banks and credit unions could see monetary losses that stem from fraud and sending new cards. Like Target, Home Depot had a data breach that compromised more than 56 million payment card records, and banks had to provide customers with new cards, The Wall Street Journal reported.
Air Academy Federal Credit Union, which saw almost $20,000 in potential fraudulent purchases from the Home Depot breach, said it is increasing security by growing its fraud department, according to the Journal. As banks protect their assets from identity thieves and cybercriminals, technology continues to act as both a sword and shield for these crucial institutions.