With each passing year, the business landscape becomes increasingly more digital. However, as the number of business practices that move online each year grows, so does the risk of fraud. These days, fraudsters can attack an enterprise from multiple angles to steal cash, organizational information or proprietary data.
However, despite their online anonymity, Deloitte argues that most of today’s cyberattacks inevitably leave behind a traceable trail of “digital fingerprints.” This trail can make it fairly easy for companies to identify and stop their would-be attackers. For this reason, lots of companies are investing heavily in fraud analytics.
Fraud analysts are responsible for helping companies reduce fraud exposure, improve organizational efficiency and increase customer trust. Those interested in pursuing a career in fraud analytics through the lens of finance and accounting can learn more about the topic in an online Master of Business Administration (MBA) with a Concentration in Accounting Analytics program.
What Is Fraud Analytics?
Fraud analytics is data analytics in the context of fraud prevention. In other words, it is a corporate strategy that attempts to detect fraudulent activities before, during and after the occurrence. By using fraud analytics, companies aim to reduce harm to their business and prevent fraudulent acts from reoccurring.
Fraud analytics works by leveraging all the available internal and external data. A fraud analyst uses this data to identify patterns, anomalies or discrepancies within the data set. This is typically an ongoing process where analysts compare weekly, monthly or annual data sets to identify long-term trends.
It’s worth noting that almost all businesses must rely heavily on data analytics in their fight against fraud. Even smaller companies can process thousands of transactions per day, which makes catching fraud too difficult for any human or department to handle manually.
By investing in fraud analytics, a company can learn from previous fraudulent incidents, better anticipate them and prevent them from happening.
Fraud Analytics in Accounting and Finance
Since this is where the money is, it’s no surprise that financial institutions and departments are popular targets.
Additionally, as more and more of the financial world moves online, it’s safe to expect financial hubs will continue to be fraud targets. Macroeconomic trends like cryptocurrency, decentralized finance (DeFi) and Web3 offer reason to believe that, at some point, our entire financial system might exist entirely online. As a result, young professionals interested in preventing financial fraud can expect plenty of work in the future.
Fortunately for the financial sector, financial institutions have a plethora of data that fraud analysts use to develop data sets and learn from them. In addition, organizations recognize the skills and value of fraud analysts and often compensate them accordingly.
How Much Does a Fraud Analyst Make?
However, it’s worth mentioning that the skills required to be a fraud analyst transfer to several positions. Essentially, fraud analysts are professional data analysts with a range of skills that apply to sectors like information technology, cybersecurity and big data. These industries are growing quickly and show little sign of slowing down anytime soon.
Additionally, many companies are interested in investing in fraud analysts as they are one of the few employees contributing directly to the bottom line.
For example, from the company’s perspective, a $100,000 salary to hire a fraud analyst is a small price to pay if that analyst protects the company from $300,000 worth of cyberattacks throughout the year. Using this logic, the company has earned $200,000 by investing in a fraud analyst.
A Career in Fraud Analytics
Companies will most likely be interested in hiring professionals with a well-rounded background in business operations, management and analytics, which is why earning an advanced degree can be a critical advantage. Some MBA programs even offer specific degrees that blend business and analytics.
For example, the online MBA with a Concentration in Accounting Analytics program from the University of Northern Colorado helps prepare students for upper-level management roles by helping them understand how to detect and prevent financial fraud. In particular, this online MBA program offers a specific course on Fraud Analytics that teaches students how to use data to identify and mitigate financial fraud risks.