Central Bank declares war on credit fraudsters: what will change for banks and customers

[Teacher]

Elvira Nabiullina spoke about new measures to protect bank customers.

During the Ural forum "Cybersecurity in Finance", the Chairman of the Bank of Russia Elvira Nabiullina said that the fight against credit fraud should become a priority task of the regulator and credit organizations this year. She noted that social engineering is increasingly leading to financial crimes due to the lack of effective barriers.

According to Nabiullina, every fourth ruble stolen from banks is borrowed funds. In 2023, fraudsters stole 15.8 billion rubles from bank customers, of which banks were able to return only 8.7%. More and more citizens apply for millions of loans under the influence of malefactors, and then transfer the received amounts to fraudsters. This not only causes significant financial damage to people, but also poses a serious threat to ruin their lives due to huge debts that will have to be paid for years.

To solve the problem, the Central Bank offers three main initiatives:

1. Introduction of a "cooling-off period" for large loans, similar to the mechanism that will be applied from July 2024 for money transfers. Such a measure, as suggested by Nabiullina, can begin to apply with loans, the amount of which starts from 1 million rubles. "We suggest starting with a million rubles, but the amount can be discussed, the cooling period can be discussed, but there is a gap between the approval of the loan and the issuance of money," the Head of the Central Bank explained. Recall that from July 25, 2024, amendments to the law on the national payment system will come into force, giving banks the right to block questionable transfers for two days with prior notification to customers. During this period, the latter must confirm or refuse to perform the operation if they realize that they are performing it under the influence of fraudsters.
2. Build anti-fraud procedures within banks when issuing loans. "Many [banks] have launched credit pipelines. This [happens] very quickly and often without anti-fraud procedures. Some banks have it, some don't, so it should be done, " Nabiullina said. She also reminded that a draft law is currently being developed on a self-ban on obtaining loans, which customers will be able to install. But, according to the head of the Central Bank, this initiative does not solve all problems, and there should be protection not only from the citizen, but also at the level of banks themselves.
3. Limit the limit for depositing cash on digital cards through ATMs. Nabiullina drew attention to a new trend of fraud involving cash. She stressed that many victims of fraudsters began to "go into cash" after increasing control over non-cash transactions. "They take a loan from one bank in cash, then come to an ATM and transfer it to a so-called secure account in another bank, to the criminal's account. This happens through cash," - said the head of the Central Bank. In order to avoid this, and speed is very important here, it is still necessary to consider setting limits in order to deposit cash on such tokenized cards, on applications through terminals. And maybe you can also see if it is recorded on a card that has just been opened to the person's bank application," Nabiullina said.

In addition, the Central Bank intends to tighten the requirements for the quality of banks ' reporting on fraud and conduct targeted checks for failure to provide or distort data. Currently, the regulator records the low quality and weak usefulness of such reports. Meanwhile, a reliable exchange of information about fraud schemes and facts is extremely important for developing effective counter - measures.

In addition, according to Nabiullina, it is necessary to create a negative perception of drops as accomplices of crimes in society. Today, many people agree to become "financial mules" for a small fee, without realizing the extent of the damage that this causes to other people.

Stanislav Kuznetsov, Deputy Chairman of the Management Board of Sberbank, confirmed the problem and said that Sberbank has already independently introduced a cooling-off period for issuing loans and uses it in cases where it is sure that the loan is issued under the influence of fraudsters. According to Kuznetsov, 24 hours is enough for the victim to understand that she was "divorced". He also suggested introducing criminal liability for drops, as Belarus did.