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Samantha: Hello, this is Samantha Shares.

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This episode covers

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Fighting Payments Fraud: A Deep Dive into
Federal Banking Agencies' New Initiative

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The following is an audio
version summary of that document.

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This podcast is educational
and is not legal advice.

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We are sponsored by Credit Union
Exam Solutions Incorporated, whose

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Forty years of National Credit

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Union  Administration experience.

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We assist our clients with N C
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Also check out our other podcast called
With Flying Colors where we provide tips

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on how to achieve success with N C U A.

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And now summary of the request for
comment on fighting payments fraud.

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Fighting Payments Fraud: A Deep Dive into
Federal Banking Agencies' New Initiative

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today we're diving into a significant
new initiative from three major

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federal banking agencies to combat
the growing threat of payments fraud.

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On June 20th, 2025, the Office of
the Comptroller of the Currency, the

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Federal Reserve System, and the Federal
Deposit Insurance Corporation jointly

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issued a Request for Information
seeking public input on how to better

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address payments fraud across the U.S.

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financial system.

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The Growing Problem

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Let's start with the scope of the problem.

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According to the agencies, payments
fraud is inflicting significant

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harm on consumers, businesses,
and financial institutions.

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They define payments fraud as quote
"the use of illegal means, including

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intentional deception, misrepresentation,
or manipulation, to make or receive

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payments for personal gain."

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The numbers are staggering.

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Data from the Federal Trade Commission
shows that losses reported for

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non-card payments fraud increased
271 percent between 2020 and 2024.

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Meanwhile, data from the Treasury's
Financial Crimes Enforcement Network

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shows that Suspicious Activity
Reports filed related to check,

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ACH, and wire fraud have increased
489 percent between 2014 and 2024.

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Check fraud is particularly concerning.

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The Treasury Department reports that
check fraud in the United States has

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risen 385 percent since the COVID-19
pandemic, and FinCEN reports that check

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fraud accounted for approximately 30
percent of fraud-related Suspicious

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Activity Reports filed in 2023.

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Why This Matters

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The agencies emphasize that payments
fraud quote "has the potential to

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erode public trust in—and undermine
the safety, accessibility, and

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efficiency of—the nation's payments
system, upon which the U.S.

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financial system depends."

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What makes this particularly challenging
is that, as the agencies note, quote "a

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payments fraud scheme may involve multiple
institutions and payment methods, each

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of which may fall within the remit of
different Federal and State agencies."

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They acknowledge that quote "no
agency or private-sector entity can

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address payments fraud on its own."

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Five Key Areas for Action

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The Request for Information focuses on
five potential areas for improvement:

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1.

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External Collaboration The agencies
are asking: What actions could

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increase collaboration among
stakeholders to address payments fraud?

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They're particularly interested in
standard setting and identifying

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organizations outside the payments
and banking industry that might

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provide additional insights.

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2.

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Consumer, Business, and Industry
Education While financial education

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resources exist, the agencies
recognize there may be a need for more

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specific payments fraud education.

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They're asking what types of
education are most effective and how

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to make existing resources better.

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3.

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Regulation and Supervision The agencies
want input on potential regulatory

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changes and whether existing supervisory
guidance is sufficient and clear.

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They're particularly interested in how
to help small community banks detect,

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prevent, and mitigate payments fraud.

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4.

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Payments Fraud Data Collection and
Information Sharing Currently, payments

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fraud data is, quote "collected in
an incomplete, non-standardized,

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ad hoc, and fragmented way."

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The agencies are exploring ways to
improve data collection and sharing while

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addressing privacy and legal concerns.

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5.

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Reserve Banks' Operator Tools and
Services The Federal Reserve Banks

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already provide risk management tools,
but they believe quote "there may be

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further opportunities for the Reserve
Banks, as a payments system operator,

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to provide additional tools and services
designed to reduce payments fraud."

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Specific Focus on Check Fraud

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Given the particular problem with
check fraud, the Federal Reserve

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is specifically seeking input on
potential amendments to Regulation

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CC, which governs funds availability.

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They're asking whether technological
advancements have reduced the

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time it takes to detect fraud
such that funds availability

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requirements should be shortened.

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The Fed notes that checks contain
sensitive information including quote

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"the payor's name, account number, routing
number, address, and signature—that

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can be used by criminals to conduct
other forms of payments fraud."

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Looking for Solutions

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The agencies are asking some practical
questions that affect everyday banking:

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•	Should Reserve Banks require fraud
reporting for all payment rails?

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•	Would confirmation of payee services
help mitigate fraudulent payments?

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•	How can financial institutions
better resolve disputes about

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allegedly fraudulent checks?

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•	What technological solutions have been
most effective in preventing fraud?

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Industry Impact

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The document reveals that the
agencies have quote "received

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complaints from supervised
institutions regarding challenges in

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resolving disputes about liability
for allegedly fraudulent checks."

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This suggests the problem is
significant enough that banks are

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actively seeking regulatory guidance.

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Next Steps

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Comments on this Request for Information
are due by September 18, 2025.

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The agencies are particularly interested
in hearing from a variety of stakeholders

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including consumers, businesses, financial
institutions, and technology providers.

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As one of the questions in the
RFI asks: quote "What measures,

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including technological solutions or
services, have been most effective in

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identifying, preventing, and mitigating
payments fraud at your institution?"

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Conclusion

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This comprehensive Request for
Information represents a significant

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coordinated effort by federal banking
regulators to tackle payments fraud.

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With fraud losses in the billions
and growing rapidly, the agencies are

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clearly taking a proactive approach
to protect consumers and maintain

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confidence in the payments system.

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The 26 detailed questions they've
posed show they're serious about

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getting input from all corners of
the financial services industry.

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Whether you're a bank, a fintech
company, a consumer advocate, or just

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someone who's been affected by payments
fraud, your input could help shape the

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future of fraud prevention in America.

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That's all for today's deep dive into
the federal response to payments fraud.

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Thanks for listening

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________________________________________
 This podcast script is based on
the Federal Register document

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dated June 20, 2025, Volume 90,
Number 117, pages 26293-26298.

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This concludes our summary.

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If your Credit union could use assistance
with your exam, reach out to Mark Treichel

00:08:02.089 --> 00:08:04.839
on LinkedIn, or at mark Treichel dot com.

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This is Samantha Shares and
we Thank you for listening.