Data is an integral part of the battle against fraud.
So says Yolandé Byrd, director of FACTS Consulting, speaking at ITWeb’s 8th annual Security Summit, in Sandton, yesterday.
Data is all around us and can be used in forensic investigations, fraud prevention and incident response, said Byrd during her presentation.
Five years ago, the biggest fraud losses were due to financial statement fraud; today, corruption is the biggest fraud threat, she said, adding that 41% of fraud cases are detected by informal tip-offs and not by formal mechanisms within the organisation itself, according to a survey by PwC. She went on to note that just 1.1% of fraud was detected by IT controls.
“Simply put, the statistics show that companies are not doing enough,” she said.Data allows a company to make better sense of the problems within its organisation, thus, rather than being perceived as a burden, big data should be seen as an asset to any organisation, she said. Even unstructured data contains valuable information that can be used when a company needs to perform analytical exercises, she added.
According to Byrd, a survey of individuals working in organisations that are effectively reducing fraud found that the effective use of data and data analytics was key to fraud prevention. This data allows the company to learn more about the fraudsters, assess the company’s fraud risk and make the best use of staff, information and financial assets.
Cyber forensics involves the securing of electronic evidence to support an investigation; this often involves huge volumes of information that can be easily filtered using data analytics, she said. For Byrd, the combination of cyber forensics and data analytics is becoming an increasingly popular method of detecting fraud and works remarkably well. “We are seeing that companies are getting a lot of value by combining data analytics and cyber forensics,” she said. “More and more, this electronic evidence that we are securing involves huge volumes and applying data analytics to these data stores derives value from the information.”
Whenever her team has to retrieve evidence and there are large volumes of information, they use data analytics to make the information simpler and more meaningful, noted Byrd, adding that this method of research allows companies to observe trends and better detect when fraudulent activity has taken place.
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