Experian is launching a new service aimed at assisting banks and building societies in identifying and shutting down ‘money mule’ accounts that are used to conceal fraudulently obtained funds.
Recent data from Experian indicates that 42% of first-party current account fraud is now associated with money mules, with the fraud rate for current accounts increasing by 13% in the first quarter of the year.
This innovative service is designed to help banks detect and investigate fraudulent accounts that often mask the flow of money from authorized push payment (APP) fraud, which resulted in £485 million in losses in the UK in 2022.
Currently, banks and other financial institutions lack detailed information about the sources and destinations of money, apart from basic payee confirmation. This limitation complicates efforts to identify and probe accounts that may be involved in such activities.
The Experian Mule Score examines account opening histories and turnover activity by utilizing bureau data and modeling characteristics from over 200,000 confirmed mule cases. This machine learning system allows banks to evaluate their entire portfolio to identify questionable account behavior.
In proof-of-concept trials, Experian reported that the system successfully identified over 50% of the highest risk mule accounts.
Eduardo Castro, managing director of identity and fraud at Experian UK&I, stated, “Mule Score is the first solution of its kind, providing financial institutions with a comprehensive view of account activity. This helps them prevent the onboarding of potential mule accounts and detect suspicious accounts that have already been opened.”