A fraud analyst is someone who investigates forgery and theft within customers’ accounts and transactions on behalf of a bank or a financial institution. They track and monitor the bank’s transactions and activity that comes through the bank’s customers’ accounts. It is their job to identify and trace any suspicious or high-risk transactions, and determine if there is improper activity involved and if there is risk to the bank or its customers. They must conduct and lead investigations into any potential fraudulent activity up to their natural conclusion. Working as a fraud analyst requires an eye for detail and an inquisitive mind. Individuals in these positions must be able to investigate fraud cases from beginning to end and dissect the nature of potential crimes. It is hard work, as it takes a lot of training to be able to succeed in this role.
An analyst will be responsible for observing any type of customer transactions to flag or identify any suspicious activity. Most accounts and customers have banking patterns that typically do not change over the long term. Any transactions or series of transactions that do not fit the expected activity should generate a flag on the part of the analyst. Once any sort of suspicious transaction is found, the analyst will flag it and keep it in suspense until it can be checked and verified. The transaction could be set off for any number of reasons: transaction type, transaction amount, unusual transfers to unlikely partners, the place where the transaction originated, or a flurry of activity beyond the accepted norm for the account.
For any suspicious transaction, the analyst (typically an officer of the bank) will try to obtain information that can support the origin of the transaction. For fraudulent items, this information can bear out who perpetrated the fraudulent item and is responsible for the criminal activity in question. The officer will need to contact the bank branch, the account holder, and any other intermediate parties that may have come in contact with or handled the questionable item. They are responsible for keeping any collected information confidential while working to catch the criminals who may have committed the felony of check fraud or electronic fraud.
On a more long-term trend, the fraud officer must also keep models for analyzing fraud within the bank’s regions. This can help determine patterns of fraud over certain areas and break down larger criminal rings responsible for fraud activity. This can also help to identify certain holes in security that can be targeted over time, so that the bank can identify system improvements that can be made to eliminate the risk of fraud or reduce the ways in which it can occur. The analyst may even have a say in software tools that can work towards detecting fraud and preventing it from occurring, or reporting security threats and suspicious activity quickly.
In order to be hired for this position, an applicant must have a bachelor’s degree of some type. It is almost impossible to be considered for the job without at least a BA. It is helpful to have a concentration in finance, business, mathematics, or economics to get into the banking industry in the first place.
Beyond that, it will be helpful to have any experience at all in programs or projects that can project a clear problem-solving or investigative ability. These traits are going to be critical in succeeding in this position, and it is vital that the applicant can display a knack for quickly solving complex problems or spotting errors and discrepancies that the normal eye may not be able to see. The ideal hire for this position is going to be able to pick out oddities from millions of transactions each day, and be able to reconcile them with bank software to detect patterns of criminal activity. The ability to notice those discrepancies is a critical asset.
The workplace is typically a white-collar, corporate office environment. The analyst will typically be in a regional or central office, where they can monitor activity from multiple sources at once. At a moment’s notice, the analyst may be able to access any type of data needed to investigate troublesome activity. This data can include cashed check copies, Automated Clearing House (ACH) electronic debits and credits, wire transfers, check logs, teller cash logs, deposit master lists, vault deliveries, recent account activity, and overall account relationships (such as accounts that serve as source funding for payroll accounts, for example).
The analyst, when conducting a fraud investigation, must piece together information from several of these sources to determine if fraud took place. If there is probable cause to suspect it has occurred, then the analyst must begin communicating with all sources - local bank personnel, affected clients, and even the respective police " to initiate and accelerate the investigation as necessary.