The Fraud Prevention Exchange, which includes established and emerging FinTech lenders, was unveiled at the Lend360 conference. The Fraud Prevention Exchange will leverage the power of collective data and help lenders face challenges brought on by originations fraud, including synthetic identity and loan stacking. Rapid information sharing among Exchange members is paramount in the battle against online fraud.
The Exchange is timely because originations fraud has resulted in hundreds of millions of dollars lost each year due to fraudulent activity that can go undetected by some lenders. Loan stacking also has materialized as an emerging issue across the industry. TransUnion data show that, on average, 4.5% of borrowers take out more than one personal loan on the same day.
Fraud Prevention Exchange members opt in to share transaction data during the verification process for new and existing customers, and the outcomes of those verifications. TransUnion analyzes this member input, watching for potentially fraudulent transaction activity and reported fraud across the network.
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