**Verification Systems Cannot Stop All Fraud Alone, Industry Expert Warns**
Speaking at EBAday 2026, Banfico’s Business Development Lead Jonathan Cardwell cautioned financial institutions that verification tools have critical limitations when combating modern fraud schemes. The key vulnerability lies in authorised push payment fraud, where legitimate account holders are manipulated into approving fraudulent transactions themselves, rendering standard verification measures ineffective.
Cardwell emphasized that fraud prevention requires a risk-based approach incorporating strategic friction points throughout the payment journey without degrading customer experience. Financial institutions must recognize verification as one component within a broader defense framework rather than a complete solution. The warning comes as APP fraud continues rising across digital payment channels, affecting banks, payment processors, and their customers.
Traders and fintech operators should expect increased regulatory pressure to implement layered security protocols beyond basic identity verification, potentially impacting transaction speeds and processing costs.
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FXnCO Insight
** Financial institutions relying solely on verification systems face mounting exposure to APP fraud losses and should immediately evaluate multi-layered detection strategies combining behavioral analytics with verification controls.
Source: Finextra