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, raising expectations of security and reliability among consumers and businesses alike.
The Federal Reserve is committed to helping educate and build awareness on 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.
Scams are a type of fraud that involves deception or manipulation to achieve financial gain. The Federal Reserve has convened work groups to recommend an operational definition that applies both to attempted and successful scams, use this definition as a basis for a structure to more consistently categorize different scam types, and offer guidelines for sharing scam information to help the industry more effectively collaborate on combatting this growing fraud problem.
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.
In June 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.
The Federal Reserve continues to engage with the industry through research on key challenges and mitigation efforts related to third-party remote authentication. These efforts will provide the opportunity to build awareness and educate industry stakeholders dealing with increasing payments fraud, particularly fraud during authentication.
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 (Off-site) as it identified and proposed actions to advance security. Learn more about this journey and other secure payments efforts with industry stakeholders.