Payment
Enable Safer Transactions
Federal Reserve Financial Services (FRFS) offers information services that help financial institutions and their customers respond to evolving threats through insights before payment initiation, threshold controls, and monitoring after settlement.
How FRFS Helps You Mitigate Fraud
Pre-Transaction Services
Gain insights to mitigate fraud before the transaction starts
FRFS helps financial institutions gain earlier visibility into risky transactions using pre-transaction tools, including the network intelligence API and Payee Name Verification, to help enable early intervention before money moves.
Network Intelligence API:
Allows a sending financial institution to request receiver account-level data observed over the FedNow Service to help assess the overall risk of a potential payment. By supplementing the data an institution already has, the tool provides a more holistic view of transaction risk.
Payee Name Verification:
Financial institutions can verify a payee’s name against account and routing information before a payment is issued. This step can help reduce authorized push payment fraud. Combined with other risk models, it also can help improve detection accuracy and reduce misdirected payments.
Threshold Controls
Control risk for instant payments
The FedNow® Service offers in-network fraud mitigation controls to complement participants’ existing payment fraud defenses. The service is designed to automatically reject transactions that do not conform to participant-specified limits. Participants can use these controls:
Account activity thresholds
In addition to individual transaction value limits, participants can set velocity and cumulative value controls by customer segment to suit business needs and risk tolerances.
Participant-defined negative lists
Participants can instruct the FedNow Service to restrict transactions to or from accounts they identify. The negative list is not shared across the network, allowing each participant to control its own list of restricted accounts.
Download the FedNow Readiness Guide to Managing Fraud Risk (Off-site).
Set FedACH® forward batch thresholds
The FedACH Risk® Origination Monitoring Service helps originating depository financial institutions (ODFIs) monitor forward FedACH® batches against cumulative debit and credit limits they set. Batches that exceed those limits are pended, and designated contacts will be notified via email, which helps ODFIs mitigate origination risk.
Post-Transaction Services
Distinguish between normal and unusual activity
Post-transaction monitoring can provide valuable insight into emerging fraud risks that may not be apparent during payment processing. The following services can help financial institutions identify unusual activity, analyze potential fraud indicators, and investigate exceptions through timely alerts and reporting.
FedDetect Anomaly Notification for FedACH® Services, part of the FedDetect Notification Services suite:
This daily monitoring service gives financial institutions added insight into atypical FedACH activity, complementing their existing fraud detection tools. It flags anomalies by comparing transactions to a financial institution’s historical baseline or applying industrywide rules. The service includes both complimentary and premier (fees apply) use cases, helping financial institutions identify potential fraud and comply with credit monitoring requirements.
Duplicate Check Notification:
This daily monitoring service alerts financial institutions to potential duplicate U.S. government and commercial checks, regardless of which bank of first deposit processed them through the FRFS network. Early detection can help recoveries and potentially prevent losses before they occur. The service is available at no additional cost to Check Services subscribers.
FedPayments® Insights Service for FedACH Services:
Financial institutions can benchmark their FedACH performance against industry data through the Benchmarking Return Rate report, which allows financial institutions to compare their unauthorized, invalid or administrative, and overall return rates against industry benchmarks, helping identify trends that may signal emerging fraud risk.
FedPayments Reporter for Check Services:
To help manage check fraud risk, financial institutions can use the Corporate Payor Report, which provides more time for your customers to review items for alterations and suspicious endorsements. The DFI-Check Advanced Notice Return Report may provide earlier visibility into returned items, allowing the depositing bank to extend fund availability holds and reduce risk of loss.
Scam and Fraud Education
Strengthen fraud detection through consistent classification
FraudClassifierSM and ScamClassifierSM models (Off-site) are designed to support consistent fraud and scam classification across organizations regardless of payment type or channel.
Stay informed and stay protected
The Fraud Mitigation Toolkits (Off-site) offer educational resources designed to help organizations identify emerging threats and take informed steps to help mitigate fraud and protect customers. The topics include account takeover fraud, check fraud, scams and synthetic identity fraud.
Ready to Strengthen Your Fraud Defenses?
Contact your relationship manager to learn more about how FRFS can help enhance payment security for your organization.
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The Fraud Mitigation Resource Center is educational only and is not intended to provide business or legal advice, nor is it intended to promote or advocate a specific action or risk mitigation strategy. Readers should consult with their own business and legal advisors for specific guidance.