In an effort to combat an increasing number of fraudulent transfers carried out using its network, SWIFT, the international bank transfer network, announced this month that it is adding new tools and controls designed to prevent fraudulent transfers in real time.
SWIFT reported that the new tools integrate into the SWIFT system directly without the need for new hardware or software and allow financial institutions to screen SWIFT message flows according to a set of pre-defined parameters. Suspicious money transfer requests would be immediately flagged and can be reviewed by a financial institution before processing.
SWIFT has been under pressure in recent years to address fraudulent transfers as a number of high profile cross-border bank thefts have utilized the network. In one instance, thieves stole millions of dollars from the central bank of Bangladesh. In that theft, cyber attackers used stolen operator credentials to submit 35 fraudulent SWIFT transfer requests totaling $951 million. Five of the requests passed, and the criminals made off with $81 million funneled through a web of offshore companies.
Once stolen funds are transferred, law enforcement and financial institutions stand little chance of recovery. The new SWIFT messaging tools are intended to stop such transfers before they occur.
Luc Meurant, head of SWIFT’s Financial Crime Compliance Services, notes that the new messaging tools are only one part of SWIFT’s broader efforts to deliver “a full suite of hosted offerings that address our customers’ needs in the fraud and cyber-crime prevention areas, as well as in the sanctions, Know Your Customer (KYC) and Anti-Money Laundering (AML) compliance domains.” To implement its new and enhanced compliance requirements, SWIFT is requiring that its customers comply with new mandatory security protocols on April 1st, with internal and external compliance audits to begin on January 1, 2018.