Intelligence Report | November 2026 - Flipbook - Page 4
BANKS ARE WAGING A NEVER-ENDING BATTLE
AGAINST FRAUDSTERS
By: Jackie Stewart
Kristina Schaefer thought she had stumbled across
an amazing opportunity — a chance to buy tickets to
one of Taylor Swift’s Eras Tour concerts from a friend
through Facebook Marketplace.
“I got excited about this,” Schaefer says, so she mes-
uitous. The Federal Trade Commission reported consumers
lost $12.5 billion in fraud in 2024, a jump of 25% from the
prior year. The significant uptick in fraud losses didn’t come
from more reports. Instead, the percentage of people who
lost money to a scheme increased.
saged the friend about it. But almost immediately the sit-
Fraud and scams affect both consumer and commer-
uation felt off. “She didn’t sound like herself. She was very
cial customers, and can take many forms — identity theft,
worried about getting the money.”
fraudulent card-not-present transactions, push-payment
Schaefer instead texted the friend and came to find out
scams, check fraud, account takeovers, internal theft by an
that the Facebook account had been hacked, and the per-
employee and more. These crimes could be perpetrated by
son’s family was blocked so they wouldn’t be able to respond
an individual based in the bank’s community or driven by an
to the post and alert others to the fraud. Fortunately for
organized crime syndicate halfway around the world and out
Schaefer, the red flags alerted her to the deception before
of reach of local law enforcement. And even when the crime
she lost any money.
is initiated outside the bank, such as on a social media plat-
“People always think, ‘I would never fall for that.’ But
you don’t think about things like this,” says Schaefer, associate general counsel and director of government relations
at Dacotah Banks, a $4.6 billion holding company based in
form, banks are often on the hook or left to help customers
sort through the aftermath.
Given all of these factors, it is incredibly difficult for
banks to effectively fight against fraud.
Aberdeen, South Dakota. “I work in fraud for a living.”
“[W]hat is the bank struggling with as far as fraud?”
Schaefer’s experience demonstrates the uphill battle
asks Andy Lapp, senior director of fraud and managed ser-
banks are currently waging against fraudsters. Fraud is ubiq-
vices at CSI, a provider of banking and risk management
solutions. “Is it ACH fraud? Is it [person-to-person] fraud?
Is it wire fraud? Is it social media scams or elder abuse?
There’s a lot of different types of fraud, and there’s not a
silver bullet that wipes them all off.”
“There’s a lot of different types of
fraud, and there’s not a silver bullet
that wipes them all off.”
The Scope of the Problem
Technology has made it easier than ever for consumers
and businesses to open accounts, move money, take out a
Andy Lapp, CSI
loan and complete numerous other banking activities that
are necessary in a thriving society. But at the same time,
these changes have made it easier for criminals to defraud
2 | BANK DIRECTOR INTELLIGENCE REPORT
