Payment Fraud what are potential risks and how can they · 07/01/2020 · Blend cyber with fraud, money laundering, identity theft, drugs and human trafficking to maximise profits

Treasury Webinar Payment Fraud – what are potential risks and how can they be mitigated

2nd July 2020

2

Introduction to speaker

Webinar speaker

Peter Nobs, Head Treasury Advisory Services, Deloitte Switzerland

Tel: +41 79 296 5797 Mail: [email protected]

Klaus Julisch, Cyber Lead & Partner Risk Advisory, Deloitte Switzerland

Tel: +41 77 438 9207Mail: [email protected]

Alexander Hänsel, Manager Solution Architect, Serrala

Tel: +49 172 454 09 87 Mail: [email protected]

Agenda

09.00h | Welcome & IntroductionPeter Nobs, Head Treasury Advisory Services, Deloitte Switzerland

09.05h | Cyber SecurityKlaus Julisch, Partner Risk Advisory, Deloitte SwitzerlandC-Level introduction to cyber security, covering how cyber threats affect organizations and how senior executives can think strategically about cyber security. The objective is to enable them to better oversee and manage cyber risks in their organizations.

09.30h | How to achieve more protection with state-of-the-art technologyAlexander Hänsel, Manager Solution Specialist, SerralaThe world of payments has become more complex than ever. Therefore, it is getting increasingly important to use state-of-the-art technology to support a company's payment processes safely and on time - topics such as "cloud" and "managed services" are playing a vital role. Companies are facing sophisticated challenges in regards to increasing fraud mechanism and attempts.

10.00h | Q&A Session10.15h | End of the webcast

© 2020 Deloitte AG. All rights reserved.

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Introduction to Zoom

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Kristina GjiniFacilitator

Eleonora ZelgerZoom Master


Cyber RisksWhat questions must the C-Suite ask itself

Dr. Klaus Julisch, Managing Partner, Risk Advisory

5

Threats are Intensifying

78%

Increase in supply chain attacks in 2018

14 secondsHow often a business falls victim to ransomware

90% Portion of attacks that begin via phishing or other social engineering tactics

$1 TrillionEstimated annual cost of cyber crime to the economy


6

So, what is Holding us Back?

• Denial / being naive (“not me”, “not now”, “just media hype”)

• Underestimating the critical dependence on IT & Digital

• Hope that IT will do it

• Long delays between today’s inaction and tomorrow's damage

• Technical complexity and difficulty of understanding / leading cyber


7

Technical Complexity


8

DestroyValue Permanently

Services without sufficient resilience can be destroyed without hope of recovery

Clients: loss of sensitive data Regulators: market confidenceSuppliers: collateral damage

ErodeReputation & Trust

DepleteAssets

DisruptOperations

Recovery time and costs; lost sales, penalties, regulatory / legal fines; stolen assets (cash, IP, etc)

ExtinguishPresenceAttacks* with sufficient

ferocity and speed can overwhelm organisations to a

point where recovery is not possible, causing business

collapse

Direct loss of productivity (employees, platforms unable to function) and indirect loss due to effort of incident response


Setting PrioritiesBeing clear on the business impact we seek to avoid

9© 2020 Deloitte AG. All rights reserved.

Setting AmbitionBeing clear on the calibre of attacker capabilities we want to withstand

Like third-party risk, on a larger scaleWhere the attack doesn’t stop at the target; it spreads indiscriminatingly between organisations; with no direct link between the origin and ultimate victims.

Contagion

Nation States Sophisticated, dedicated cyber teamsFocus on defensive and increasingly offensive campaigns. Some states engage in industrial espionage for strategic goals, and cyber crime to raise funds.

Constantly targeted as a weak spotBeing inside the business often means fewer protective measures apply, impacts are greater. Also includes disgruntled employees, or accidents by employees.

Employees

Third-Parties

Sophisticated capabilities, ongoing investment and advancementBlend cyber with fraud, money laundering, identity theft, drugs and human trafficking to maximise profits. Evade prosecution by leveraging trans-jurisdictional operations.

Org. Crime

Terrorists


Choosing a Defense ParadigmTrading off security vs. cost

Incident

Threat

Threat

Threat

Consequence

Consequence

Consequence

Prevention: Detection & recovery: Stop the incident Stop the consequences


Balancing Control TypesAvoiding the fallacy of “overdoing” technical defenses

DynamicStatic

Technical

Organizational

Preventative

technical

controls

Technical IR(SOC, Hunting, IOC, dynamic architecture, etc.)

Crisis management

GRC, risk mgmt.,risk acceptance, etc.


Doing the WorkNow that priorities are clear, work can start

Current (red) & target state (green)

Cyber capability catalogue

Plan and deliver change


Outlook: The Changing Threat Landscape

Collateral damage – you don’t have to be a target to become a victim

Disruption rather than monetary gain as a motive, and changing diplomatic norms

Supply chain attacks

Proliferation of nation-state cyber weaponry & changing diplomatic norms

Convergence of crimes: Cyber, fraud, AML, physical, and social

1414

Thank you!

?

Cyber is about starting things. Not stopping them.

Sparking the confidence that builds the freedom to create.

How to achieve more protection with state-of-

the-art technologySmart & Secure Payment Management with Serrala FS² solution

FS² Payments Solutions – Universal, SAP Integrated

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1. Payments challenges & needs

2. SAP integrated solution approach

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Payments Challenges &

Needs

19

Payments Challenges & Needs

Fragmented,

manual processes

Streamline &

digitize “paper

based” flows on a

central platform.

Risks of late

payments

Reduce the risk of

late payments with

automation & real-

time status monitor.

Formats & bank

connectivity

Outsource all

format &

connectivity needs

to our experts.

Fraud & ComplianceVisibility

Monitor the full

payment lifecycle &

all bank account

activity.

Proactively control

risks with fraud &

compliance

screening.

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Solution Approach

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FS² Payments – Universal Payments at a Glance

• Integrates in SAP, leveraging your

master data and procedures.

• Allows inclusion of all ERPs for

centralized visibility and control.

• Delivers end-to-end payments

workflow with true straight-through

processing.

• Provides SAP drill-down to original

journal postings.

• Unifies all payment processing on one

platform: payment runs, manual

payments, approval workflows, status

monitoring….

• SAP FIORI ready, delivers full

dashboard transparency.

Standardize and

Centralize

• Combines on premise advantages

with cloud agility.

• Outsource formats and bank

connectivity to our experts for fast

expansion to group-wide coverage.

• Choose between SWIFT, H2H,

EBICS. Easily adopt API for instant

payments and other bank information.

• Build out your payment factory with

payment optimization functionalities.

• Extend in-house banking services with

POBO (payments on behalf).

• S/4HANA ready when you want to

upgrade.

Be future-proof

• Ensures end-to-end security, through

tight integration and encryption.

• Automated real-time fraud checks on

every single payment.

• Stops illegal payments through

compliance screening.

• Customized separation of duty and

approvals.

• 2 factor authentication via tokens or

mobile app.

• Provides full audit and payment

lifecycle tracking.

Protect and prevent

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Fraud & Compliance integrated within FS² Payments

Compliance screening

Our definition

• Establish a single point of information / source for all payment

files from multiple sources (e.g. SAP FI, TRM, IHC, FS²

modules, external sources)

• Standard connectivity to external compliance providers (e.g.

ID.prove, DNB, Bisnote, etc.)

Our solution

• Extract required information from payment files and send it to

the compliance provider

• Real-time processing of provider feedback

• Integration into payment approval workflow

Fraud screening

Our definition

• Establish a single point of information / source for all payment

files from multiple sources (e.g. SAP FI, TRM, IHC, FS² modules,

external sources)

• Screening process based on pre-defined rules (patterns) to

identify suspicious payments

Our solution

• One single solution integrated in the central SAP environment

• Preset of Fraud detection rules

• Engine to design customer specific Fraud detection rules

• Fully integrated within payment approval workflow

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Scoring & Fraud Monitoring Processes

Based on the calculated total score

of a payment, the possible follow-up

processes are defined.

• Fraud Alarm 1:

The entire file is passed to the Fraud

Monitor for checking

• Fraud Alarm 2:

Identified single payments are

transferred to the check

• Fraud Alarm 3:

Fraud suspicious payments are

placed in the fraud report

• Fraud Alarm 4:

No fraud, normal process will persist

Fraud Monitor

Fraud suspicious paymentsare fetched from the usualrelease process and requirean additional check. Separateapprovers check the paymentsand decide whether or not thepayment may be executed.

Fraud Report

All fraud-identified paymentsare displayed in a report.

Exeception Lists

Certain regular payments canbe identified by the fraudcheck. These payments canbe defined in exception-lists inorder to exclude thesepayments from the regularfraud review.

Flexible integration in overall process

It is possible to flexibly decideat which point of the processthe fraud check and follow-upprocesses are carried out

!

24

FI

Integration of the Fraud functionality within FS² Payments

FS² Payments

Customer

Bank

Invoice

Processing

Payment file

importFraud Check Fraud Monitor

Suspicious to Fraud

“Compliance”

Rejection & Reversal

Fraud

investigation

check: OK

No hit or no

sufficient score

TransmissionPayment approval

process

Hit

Generate Payment

file (F110 / F111)

http://upload.wikimedia.org/wikipedia/de/5/59/SAP_2011_logo.svg

25

Target Operating Model

Flexibly implement all functions needed to

centralize payment processingThe Serrala Cloud provides out of the box

connectivity and collects all important files

Bank A

Bank B

Bank C

Bank n

Other SAPs

Other ERPs

HR systems

TMS

HR

SAP

Environment

Global Payment Factory

Central control,

optimization & POBO

Payments Processing

All payment types

using any method

Workflows

Customizable

payment workflows

Hybrid Cloud

Combines cloud

with on premise

Real-Time Analytics

Achieve full transparency

Fraud & Compliance

Stops and review all

suspicious payments

Payments

Send SAP iDOC, Bank-Ready,

Payment Data, Confidential

Account statements

Payment Statements

Serrala CloudPayment as a Service

Leverage all SAP set-up

FS² Payments

26

Features & Key Take Away

Monitoring

• Monitor all cash flows (inbound and outbound) at a glance

Workflow Standardization

• Centralize and standardize process flows, while still

maintaining decentralized operations.

Security & Auditability

• End manual file handling and segregated systems for

payment processing. All information is collected and

processed in one trusted system (SAP)

Direct Postings

• Standardized SAP FI connect

• Automatic posting of intercompany payments without

any required interface

Central Payment Hub

• Eliminate existing bank portals and/or software, and

centralize bank format creation and connectivity.

Fraud & Compliance

• Screen and secure external payments to the

maximum. Ensure that payments comply with

sanction and embargo rules and regulations.

Automation

• Reduce manual processes to a minimum

Flexible Scalability

• Scalable from domestic usage up to International

Payment Factory

Contact us to

find out more!

Alexander HänselManager Solution Architect

+49 (172) 454 098 7

[email protected]

serrala.com

This publication has been written in general terms and we recommend that you obtain professional advice before acting or refraining from action on any of the contents of this publication. Deloitte AG accepts no liability for any loss occasioned to any person acting or refraining from action as a result of any material in this publication.

Deloitte AG is an affiliate of Deloitte NSE LLP, a member firm of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee (“DTTL”). DTTL and each of its member firms are legally separate and independent entities. DTTL and Deloitte NSE LLP do not provide services to clients. Please see www.deloitte.com/ch/about to learn more about our global network of member firms.

Deloitte AG is an audit firm recognised and supervised by the Federal Audit Oversight Authority (FAOA) and the Swiss Financial Market Supervisory Authority (FINMA).


Documents

Payment Fraud what are potential risks and how can they · 07/01/2020 · Blend cyber with fraud, money laundering, identity theft, drugs and human trafficking to maximise profits