The international payments system is largely based on the three-decades old SWIFT messaging system. But cyberattackers have exploited weak controls employed by banks to make fraudulent transfers. Nick Armstrong, CEO and founder of Identitii sees a path forward for securing payments made with legacy systems.
Sydney-based Identitii has developed a software overlay for SWIFT that Armstrong says leverages the underlying messaging system but provides banks with more accurate information to make payment decisions and comply with regulations. It also uses blockchain to create a private distributed ledger that acts as an immutable record of transactions.
"SWIFT is still referred to as a telegraphic transfer, which is a hangover from the days of the telegraph," Armstrong says. "And what that means is that limited information can be sent because of constraints in the messaging format. That has created opportunities for fraudsters."
In this interview (see audio link below photo), Armstrong discusses:
- Why banks aren't receiving enough information about pending payments from their legacy systems that enable them to make decisions on possible fraud;
- How it is possible to modernize legacy networks rather than rip and replace; and
- Why it's more important these days to know your transaction rather than know your customer.
Before Identitii, Nick Armstrong was CEO and founder of COzero, which developed energy management software and a carbon trading portal. He is also the founder of two other energy-industry companies, Originate Carbon and Greentricity, which focused on innovation in renewable energy.