The growth and evolution of ACH/wire fraud

Fraud on Automated Clearing House (ACH) payments has gone through an evolution. It started out with fraudsters getting involved as originators of fraudulent ACH transactions. They would create fictitious transactions, either by not getting consumer consent or over-charging consumers on transactions. A heightened awareness of on-boarding originating businesses and escalated...

Predicting strategic default

The incidence of strategic default is on the rise. But before mortgage servicers can take action, they first must be able to identify strategic defaulters. Standard credit risk scores aren't sensitive to the quite different characteristics of these voluntary strategic defaulters, whose behavior is driven by incentive to pay rather...

Who are your strategic defaulters?

Accurately predicting strategic default risk remains a big challenge for mortgage servicers. Because strategic defaulters behave differently from traditional mortgage defaulters, it's quite difficult for servicers to identify consumers with the greatest potential to strategically default. And after all, you can't predict what you can't measure. FICO recently conducted research...

The hidden cost of fraud

Traditionally, fraud losses are measured by looking at fraud transaction dollar losses and operational costs. But institutions should begin to pay more attention to reputation and loss of confidence—often the “hidden” costs of fraud. While it's true that these costs are less obvious and harder to measure, that doesn't mean...

Survey reveals issuer response to the CARD Act

When the CARD Act went into effect last year, compliance and rising delinquencies commanded the attention of card issuers, often at the expense of revenue-generating activity. A recent FICO client survey asks: have issuers turned the corner? To find answers, we asked a range of both large and small issuers...

How collections tactics affect the payment hierarchy

As I noted in a recent post, there is growing evidence of a shift in the payment hierarchy among European borrowers. This shift moves housing payments down in the hierarchy, and makes credit cards a top priority. Why is this change happening? Non-payment of a credit card has a more...

More Hopeful Signs in Latest Banker Survey

As I mentioned a couple days ago on the blog, FICO’s most recent quarterly survey of bank risk officers gave us plenty of positive signals. In addition to anticipating a drop in delinquencies, bankers are expecting the “credit gap” to narrow in the coming months. Our survey of more than...

New Regulation Raises Consumer Awareness of Credit Scores

While the FICO® Score is certainly no stranger to thousands of US banks and credit unions, a new federal regulation is introducing this important three-digit number to millions of consumers for the first time. The Fair Credit Reporting Act’s risk-based pricing rule, issued by the Federal Reserve and the Federal...

Call for presentations: Submit your FICO World session idea

As FICO™ World 2011 approaches, we invite FICO clients and other industry thought leaders to submit proposals for conference sessions related to predictive analytics and key issues in retail banking and insurance. The FICO World 2011 conference will be held in New York from November 1-4. It’s easy to submit...