LIMRA and the SPARK Institute are teaming up to fortify fraud prevention measures within the retirement and life insurance industry.
The collaboration seeks to establish industrywide initiatives to better combat fraudulent activities by focusing on four key areas, the first being its upcoming Fraud Prevention Benchmarking Study set for release in the first half of the year. The study will highlight fraud prevention practices and will “serve as a foundation for identifying best practices, gaps in existing strategies and areas for improvement within the sector,” LIMRA and the SPARK Institute say.
“The evolving landscape of financial fraud demands a proactive and collaborative response from the industry,” said Tim Rouse, executive director of the SPARK Institute, in a release announcing the collaboration.
The two groups will also work together to develop and distribute educational resources for both plan sponsors and participants and will use LIMRA’s FraudShare platform to exchange fraud incident and threat intelligence. Lastly, LIMRA and the SPARK Institute plan to establish a Financial Services Fraud and Data Security Summit. This annual event will bring together industry experts, thought leaders and other key stakeholders to share insights, discuss emerging trends and collaborate on solutions to combat fraud more effectively.
“By combining our expertise and resources, we can drive meaningful change in fraud prevention, foster a culture of vigilance and ultimately protect the integrity of the retirement industry,” said Russell Anderson, head of Financial Crimes Services at LIMRA and LOMA.
The partnership comes just a year after a data breach involving a MOVEit file transfer program impacted 40 million participants associated with TIAA, New York Life, CalPERS, and the Tennessee Consolidated Retirement System (TCRS). Participant names, Social Security numbers, dates of birth, and mailing addresses were all compromised during the hack.
As a result of the mega breach, TIAA was sued for failing to properly store sensitive participant data, among other allegations.
Retirement plans can be an attractive target for cybercriminals. 401(k) plans today hold a combined $6.9 trillion in assets and are mostly managed online, thus offering easy access for malware to disrupt digital systems.
The risk of cyberattacks among retirement plans is so high that government agencies, like the Securities and Exchange Commission (SEC), have prioritized cyber-resiliency as a top area of concern for this year. In its 2024 examination priorities, the SEC’s Division of Examinations said it would focus on registrants’ policies and procedures, internal controls, oversight of third-party vendors, governance practices, and responses to cyber-related incidents, including ransomware attacks.
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