ICYMI: CBA Convenes Cross-Industry, Public-Private Roundtable to Inform Whole-Of-Government Approach to Combat Fraud and Scams

WASHINGTON, D.C. – The Consumer Bankers Association (CBA) last week convened a roundtable with participants representing the federal government, private sector entities, non-profit consumer organizations, and industry trade associations from the banking and telecommunications sectors to discuss a White Paper that outlines a national strategy for combatting fraud and scams. The White Paper, written by Nick Bourke, former Director of Consumer Finance at The Pew Charitable Trusts, was released earlier this week. Today, CBA published a summary of the roundtable discussion and proposed next steps and deliverables for a government-private, cross-industry national strategy for fraud and scams.

Commenting on the conclusion of the roundtable, CBA President and CEO Lindsey Johnson said today in a new statement:

“As fraudsters and scammers become more sophisticated than ever, it’s imperative we have robust collaboration between government and industry to minimize risk, educate consumers, and develop commonsense policies to hold these bad actors accountable. No single industry, sector, or government agency can combat fraud and scams alone. A coordinated national strategy is necessary to meaningfully address this issue and protect the millions of Americans we are all working to serve.”

Key Takeaways

The following are high-level key takeaways from the roundtable discussion:

• Bad actors scam and defraud consumers across a range of sectors and extract money from the banking system using fast and highly integrated tactics. In order to combat these evolving tactics, the government must spearhead a cross-industry public-private national strategy against fraud and scams;
• There is a need for targeted and constant consumer education that is relevant at multiple stages of fraud and scams;
• Participants raised the need for effective consumer education that destigmatizes reporting by victims of frauds and scams, as well as clear and consistent mechanisms to report fraud and scams;
• A national strategy for combatting fraud and scams requires coordination across a range of relevant industries, including sharing of information, expertise, and data;
• Government participation will be necessary to enable knowledge sharing across industries and the public-private divide;
• Incentives for promoting information sharing and data exchange may need to be reevaluated; and
• Law enforcement must be actively invested in, and adequately resourced for, the fight against fraud and scams.

Recommended Next Steps

The below are CBA’s recommendations for a government-led public-private national strategy to combat fraud and scams.

Near-term efforts include:

• Inventory and promote pre-existing tools that are already in the market that can help consumers; and
• Commit to a broad-based consumer education strategy that, among other goals, destigmatizes reporting by victims of frauds and scams and provides encouragement to consumers that such reporting will both help prevent other consumers from falling prey to similar tactics as well as lead to a higher likelihood that law enforcement will be better positioned to recover illicit funds and bring enforcement actions against bad actors.

Medium-term efforts include:

• Advocate for information-sharing safe harbor frameworks, such as Patriot Act Section 314(b), to be clarified and broadened regarding fraud and scams;
• Advocate for the expansion of the use of the Rapid Response Program and Financial Fraud Kill Chain to be used to trace and assist with recovery of the proceeds of fraud and scams from bad actors, as well as to encourage with potential law enforcement activity;
• Advocate for the Department of Justice to extend grant funding from the Office of Victims of Crimes for work relating to fraud and scams; and
• Continue to advocate for the CFPB to use its Civil Penalty Fund for consumer education and other efforts relating to fraud and scams.

Long-term efforts include:

• Identify and, where necessary, create metrics and definitions to help educate policymakers on the need to prioritize work relating to fraud and scams;
• Explore alignment on data standards for sharing information across industries and between the private and public sectors;
• Support National Institute of Standards and Technology efforts regarding digital identity standards, as applicable for use in retail consumer financial services;
• Urge law enforcement officials to prioritize of fraud- and scam-related prosecutions; and
• Call for greater international coordination on fraud and scam enforcement, highlighting the proximity to money laundering issues and bad actors.

CBA Advocacy

• Ahead of a Senate subcommittee hearing regarding fraud and scams on the Zelle platform, CBA joined a letter with other associations explaining everything banks are doing to combat fraud and scams and identifying additional steps needed to prevent them. To read the letter, click HERE.

• Ahead of a Senate hearing in January, CBA submitted a letter to Congressional leaders reinforcing the leading role the banking industry has taken to identify and counter fraud and scam threats to consumers. To learn more, click HERE.

• In a letter sent to CFPB Director Chopra, CBA President and CEO Lindsey Johnson called for a whole-of-government approach to combat the rise in scams and prevent consumer harm and use its civil penalty fund to help with consumer education on fraud and scams. To read the full letter, click HERE.

• A national survey released last year from CBA found that an overwhelming majority – 8 in 10 Americans (83 percent) – believe banks are doing a good job helping them avoid scams. To learn more, click HERE.

• To read CBA’s most recent blog highlighting some of the many ways banks are working to protect consumers from falling prey to scams and fraudsters, click HERE.