The fight against fraud in auto finance continued last week.

PointPredictive held its second Auto Lending Fraud Roundtable last week in Dallas with finance companies representing 48 percent of total automotive originations in the U.S. They met to further collaborate on progressing finance companies’ fight against fraud as well as protecting consumers that can be targeted by fraudsters and potentially unscrupulous dealer employees.

“Auto lenders continue to show significant interest in reducing fraud and increasing customer protection through industry collaboration, data sharing and our consortium-based predictive technology; they are thinking of the bigger picture when it comes to fraud,” PointPredictive chief executive officer Tim Grace said.

“We have invested heavily in organizing the fraud data consortium, collaborative lender roundtables and machine-learning predictive fraud detection models,” Grace continued. “Through lender testing and validation, we demonstrated that these solutions can identify multiple sources of hidden fraud and can help lenders reduce fraud and fraud-related early payment default losses by at least 40 percent.”

To advance the fight against fraud, PointPredictive demonstrated and announced the availability of Auto Fraud Manager 2.0, a consumer application scoring tool that can increase fraud detection by leveraging improved predictive algorithms that evaluate the entire application and recent applications from individual dealers to detect all types of fraud including identity, employment, income, collateral and dealer risk.

The company highlighted that recent retrospective results using the latest Auto Fraud Manager show false positive rates of 6:1 or better for high-risk applications.

PointPredictive also released DealerTrace 2.0, an automotive dealer scoring tool that identifies dealer misrepresentation risk across the industry. DealerTrace now includes cross-industry application history and risk assessments on multiple misrepresentation dimensions for more than 50,000 automotive dealers.

In other tests recently completed with large finance companies, Auto Fraud Manger and DealerTrace were able to identify nearly 50 percent of fraud and fraud-related early payment default (EPD) losses in the riskiest 10 percent of applications.

PointPredictive highlighted Auto Fraud Manager 2.0 and DealerTrace 2.0 include significant infrastructure enhancements that were demonstrated at the roundtable meeting. They now process more than 5,000 scoring transactions per second, thereby enabling finance companies to receive a complete risk analysis and assessment of each application and dealer in a fraction of a second.

PointPredictive also demonstrated new Web-based interfaces that provide dashboard reporting, “drag and drop” functionality for file-based scoring, and interactive real-time filtering and display of risky applications and dealer activity. Leveraging an industry-wide consortium that provides solutions for all types of fraud schemes and looking at the entire consumer application and dealer application history allows lenders to better protect themselves and their consumers.

“We are providing lenders with intuitive solutions to help them better visualize and understand hidden fraud risks,” said Kathleen Waid, head of go to market at PointPredictive. “Most of the traditional third-party tools lenders use today to prevent fraud are focused on identity theft; this is only 15 percent of their total fraud problem.

Our clients are seeing unprecedented results in tests that, in many cases, span two years of historical applications. With the release of Auto Fraud Manager 2.0 and DealerTrace 2.0, lenders can begin using our solution immediately,” Waid added.

For further information on Auto Fraud Manager, DealerTrace or to join the Auto Fraud Consortium, contact Waid at kwaid@pointpredictive.com.