The U.S. payment system faces dynamic, persistent and rapidly escalating threats as technological developments make it easier than ever to commit fraud involving payments. E-commerce and smartphones have changed how we authenticate users and increased the points of vulnerability, while raising expectations of security and reliability among consumers and businesses alike.
The Federal Reserve is committed to helping educate and build awareness about the fraud landscape, with a focus on reducing fraud risk and advancing the safety and security of the payment system. Learn more about various initiatives below.
Fighting Scams
Scams are a type of fraud that involves deception or manipulation to achieve financial gain. In 2024, the Fed-led scams definition and classification work group developed the ScamClassifierSM model, a voluntary scam classification structure to help the industry categorize different scam types more consistently by using this agreed-upon definition as a basis. A scams information sharing industry work group explored information sharing approaches to help mitigate scam activity. The group developed recommendations that were published in a 2024 report.
Defining, Detecting and Mitigating Synthetic Identity Fraud
The Federal Reserve is dedicated to raising awareness and encouraging action in the fight against synthetic identity fraud. A Fed-convened focus group helped address the problem of multiple definitions of synthetic identity fraud throughout the industry by developing an industry-recommended definition, released in 2021. Then, in early 2022, the Fed published a Synthetic Identity Fraud Mitigation Toolkit which provides insights and resources to encourage awareness, understanding and broad industry collaboration.
An Intuitive Approach to Classifying Fraud
In 2020, the Federal Reserve announced the FraudClassifierSM model. Developed by the Fed-led Fraud Definitions Work Group, the model enables organizations to classify fraud in a consistent manner to create a holistic view of fraudulent events and help with more strategic fraud management. Explore the model, including how to register for access to the full model and supporting definitions, as well as additional tools and resources.
When Fraud Occurs During Authentication
The Federal Reserve has engaged with the industry through research on key challenges and mitigation efforts related to third-party remote authentication. These efforts offer the opportunity to build awareness and educate industry stakeholders dealing with increasing payments fraud, particularly fraud during authentication.
Understanding and Addressing Secure Payments
Since 2013, the Federal Reserve has collaborated with a wide array of industry stakeholders to advance payments security. From June 2015 through March 2018, the Fed established and led the Secure Payments Task Force as it identified and proposed actions to advance security. Learn more about this journey and other secure payments efforts with industry stakeholders.