Agencies request information on targeting payments fraud

ICBA applauded the federal banking agencies for announcing a request for comment on potential actions to help consumers, businesses, and financial institutions mitigate risk of payments fraud, with a particular focus on check fraud.

Request from Agencies: The agencies are seeking public comments on discrete actions, collectively or independently, to mitigate check fraud and other payments fraud within their respective bank regulation and payments authorities.

Key Issue Areas: The agencies requested input on five potential areas for improvement and collaboration:

• External collaboration among the agencies, Federal Reserve Banks, and industry stakeholders.

• Consumer, business, and industry education.

• Regulation and supervision to mitigate payments fraud.

• Data collection and information sharing.

• Federal Reserve Bank operator tools and services.

First Step: Federal Reserve Vice Chair for Supervision Michelle Bowman said the request is a “welcome first step” in agency efforts to combat the increasing occurrence of fraud, citing the harm of check fraud on community banks, consumers, and businesses. Bowman called for a comprehensive strategy to develop and implement an effective, coordinated approach.

Next Steps: Comments must be received within 90 days after date of publication in the Federal Register. The agencies said they will also continue looking for additional opportunities to effectively collaborate across other state and federal agencies given the importance of interagency coordination to help mitigate payments fraud.

ICBA Support: ICBA applauded the announcement in a national news release, noting ICBA and community bank efforts to combat check fraud. “ICBA looks forward to working with Federal Reserve Vice Chair Michelle Bowman and others at the regulatory agencies to ensure a more secure payment system for U.S. consumers,” ICBA President and CEO Rebeca Romero Rainey said.

ICBA Resources: ICBA has strongly advocated a federal response to rising check fraud and offers resources to help community banks combat the problem. For instance, ICBA:

• Is encouraging community bankers to order physical copies of a check fraud prevention flyer to distribute to customers.

• Is partnering with the U.S. Postal Inspection Service on these flyers and other resources, including a customizable news release available on ICBA’s Marketing Resource Center.

• In March applauded the Trump administration for working to combat the threat of check fraud by addressing the Treasury Department’s use of paper checks.

• Offers additional community banker resources—including guides on check fraud and online fraud courses—via the ICBA website.

• Hosts the Fraud subgroup on ICBA Community, which features more than 900 members dedicated to discussing fraud.

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