Friendster or Fraudster?

As social networks such as Facebook and LinkedIn have proliferated, so too has the potential for fraudsters to draw upon sensitive information about individuals that's inadvertently posted on these sites.

"If I was a fraudster, I would love to social network" in order to extract unique information about an individual, such as their mother's maiden name, to help crack one or more of their bank accounts, says Rod Nelsestuen, an analyst at TowerGroup in Needham, MA.

To help banks combat potential fraud that could be generated from social gathering sites, SAS Institute, Inc. last year introduced the SAS Social Network Analysis tool, a component of the SAS Fraud Framework which is aimed at helping banks and other financial institutions detect and prevent fraud by enabling customers to analyze all related activities and relationships from a network perspective.

The social network analysis tool includes an intuitive network visualization interface that enables fraud investigators at a bank to view network connections and to help uncover previously unknown relationships between customers and other individuals, including potential thieves. The system also allows investigators to determine the risk profile for each customer and develop a risk score for all associated networks by applying behavioral data.

SAS, which has a rich heritage in analytics capabilities, draws upon those strengths in both the social network analysis tool and for its SAS Fraud Framework, says Nelsestuen. "Other fraud technologies may not have the same depth in analytics."

Another feature of the SAS system is anomaly detection capabilities that can be captured across checking, ACH and a broad range of transactions, says Ellen Joyner, global financial services director for the Cary, N.C.-based software company. Nelsestuen says SAS' anomaly detection capabilities "matches up with almost anyone I've seen."

But the framework's biggest strength might be in the simplicity of the user interface that SAS has created for non-technical users, says Nelsestuen. "What they've done is made the technology usable for business users," says Nelsestuen. "Like Harley Davidson, it still has its loyal users but also a simplified user interface for newer customers."

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