Despite the banking industry’s significant effort and investment in fraud prevention tools, bad actors continue to target U.S. consumers, Darrin McLaughlin, EVP for Flagstar Bank, told House lawmakers today.
McLaughlin — who is also the Flagstar’s chief Bank Secrecy Act/anti-money laundering and sanctions officer — testified on behalf of the American Bankers Association before the House Financial Services Subcommittee on National Security, Illicit Finance and International Financial Institutions, which held a hearing on combating fraud. In prepared remarks, he emphasized the need for others in the public and private sectors to join banks in addressing fraud.
“Banks strive to follow all applicable BSA and compliance rules, educate our customers, train our employees and invest in sensitive detection and compliance systems,” McLaughlin said. “But banks are in a difficult position with only limited tools to address this growing problem. The federal government and other private sector industries, including telecommunications and social media, must do their part. Combating fraud requires a whole-of-government approach, partnered with the private sector.”
McLaughlin outlined key changes needed to optimize bank efforts to combat fraud, including more actionable feedback from the government on priority threats.
