In this article, we’ll go over the challenges faced by the fraud departments at financial institutions, as well as how a dedicated identity restoration solution can reduce the burden on those teams and streamline their operations.
Identity theft is a major challenge for financial institutions. Between detecting the fraud, investigating it, and repairing the damage, financial institutions are losing an additional four dollars for every dollar lost to a fraudster. With these significant losses, financial institutions need effective strategies to help reduce losses and enhance customer service, and this includes streamlining how fraud departments deal with follow-up calls from identity theft victims.
By dividing their attention between their main duties and following up with customers who have victimized by identity theft, it slows them down and prevents them from improving their operations and better serving other customers.
However, with a one-touch identity fraud solution, financial institutions can transform their operations and focus on what really matters—better serving their customers.
The impact of fraud and identity theft on consumers and financial institutions
Identity fraud is a problem that is here to stay. While the number of identity theft reports vary from year to year, research has proven that identity theft reports often number in the millions each year, with over 1.1 million reports of identity fraud in 2024.
And with 45 percent of customers contacting their financial institutions when they experience identity fraud, financial institutions need to do everything they can to reduce the impact of identity fraud on their operations. 31 percent of banks said that identity fraud incidents cost them $479,000 on average, with 44 percent of that cost coming from business disruptions.
Although it can be assumed that much of this cost stems from the investigation of these identity fraud incidents, some of the cost also comes from responding to repeated calls from customers regarding several issues, such as what steps they should take to take to protect their identity and other related topics.
Unfortunately, many financial institutions aren’t don't have the resources they need to address this kind of situation, with 41 percent of dissatisfied customers reporting that they wished their financial institution had treated them like a victim instead of a burden.
While many financial institutions handle the investigation of the identity theft, they often don’t extend any services beyond that. This can result in fraud teams being bogged down by customer calls that interfere with their productivity.
After all, most of the time their responsibility is to investigate the fraud and solve any issues faced by the financial institution, not to restore a customer’s identity. Identity restoration is a complex process as identity theft often affects multiple types of accounts such as credit, bank accounts, and more. Not only does this restoration process require specific expertise, it also requires a significant time commitment to thoroughly resolve it. And with identity theft victims often experiencing additional identity theft incidents, this time commitment can grow significantly if the customer’s identity isn’t properly restored.
Without a dedicated solution, they’re stuck fielding calls that derail productivity and delay case resolution.
How a one-touch fraud solution can transform a fraud department’s operations
A one-touch identity fraud solution can serve as a comprehensive resource for your fraud team by handling all of the communications and services that your customers need following an identity theft incident.
An identity fraud solution is critical for streamlining the operations of your fraud department by providing a dedicated resource for:
Certified restoration support
With certified restoration support, your customers can get the service and support they need to restore their identity and avoid another identity fraud incident—all while streamlining your fraud department’s operations.
This restoration support can include several different aspects, including sending dispute letters, calling government agencies, handling the process of repairing damage to credit, and much more. With your fraud department avoiding fielding these calls, they can do what they do best—investigating fraud and closing more open cases.
With a certified restoration team that has high satisfaction scores, you can help ensure that your customers experience a quick and effective restoration experience, which may help improve customer satisfaction and retention.
Expert guidance for next steps
Once your fraud department has investigated the incident, they can then direct the customer to the external identity protection team for the customer’s identity restoration, which may include other accounts, such as their credit score.
And better yet, this team can provide them with the knowledge they need to prevent further identity theft incidents, saving your fraud team from sinking more time into investigating new incidents.
These kinds of questions can include who else they should report the fraud to, how they should report it, steps they can take to protect themselves from future identity theft, how to recognize other forms of identity theft, and more.
To learn more about how Allstate Identity Protection can help your financial institution streamline operations, increase the value you offer to customers, and differentiate your services, visit our channel partners page.
