Managing fraud, waste, and abuse has always been a challenge for banks and financial services institutions and the Paycheck Protection Program (PPP) has increased the potential for malfeasance. Learn how organizations like JP Morgan are using fintech and other digital tools to combat fraud, waste, and abuse and recoup losses.
JP Morgan Identifies Evidence of Misuse of PPP Funds
This week JP Morgan released a report detailing instances of fraudulent employee and customer actions related to the Paycheck Protection Program. The Hill shared a memo obtained from JP Morgan that noted several instances of conduct that “does not live up to our business and ethical principles – and may even be illegal.” This included “instances of customers misusing Paycheck Protection Program loans, unemployment benefits and other government programs.”
You can read the full story here.
Managing PPP Loans is Easier with Digital Solutions
JP Morgan is certainly not the only financial services institution grappling with fraud, waste, and abuse issues. In a recent Financial Technology Today article industry expert, Jack Leach, shared his insights on how digital solutions make it easier for banks to manage the Paycheck Protection Program, particularly during the loan origination and forgiveness processes. Said Leach, “[m]oving toward digital processes helps to better organize, ingest, and streamline information. This doesn’t necessarily mean eliminating all traditional and manual processes, but digitization is critical as both banks and businesses work to navigate the PPP process and effectively compete in the post-COVID-19 environment.so API and integration solutions available.”
You can read more about what Leach had to share here.
Spike in Suspected Business Loan Fraud Coincided with PPP
According to a recent investigative report by Nick Schwellenbach in Pogo, “[b]anks filed an abnormally high number of reports of suspected business loan fraud in July.” There was a 700 percent increase in reports of loan fraud reported to FinCEN during the month and it coincided with the disbursement of PPP loans and other COVID-19 related efforts.
To learn more about the shifting fraud landscape, click here.
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