How FinTech, Fraud, and Regulation Are Shaping Payments

Episode Summary
Join us for this final episode of season 2. In this episode of Wrestling Payments, host Joseph Casali is joined by Sean Carter, President & CEO of NEACH, and Mary Mumper-Morrison, NEACH’s Education Director, for an insightful discussion on the evolving landscape of payments. The trio dives into the significant changes from 2024, including NEACH rule updates and the growing adoption of AI in financial systems. They reflect on the year’s challenges and how fraud has escalated, demanding innovative responses from the industry.

Mary shares her expertise on regulatory shifts, such as the CFPB’s personal financial data rights rule, while Sean highlights the importance of collaboration between operational and compliance teams to tackle fraud effectively. Both guests emphasize the need for clearer fraud definitions and better public education to combat scams and deception.

Looking ahead to 2025, the conversation explores emerging opportunities with FinTech partnerships, embedded finance, and AI-driven innovation. The episode wraps with hopes for reducing fraud and improving industry resilience.

 Guests-at-a-Glance
Sean Carter
President & CEO
NEACH
A payments industry veteran passionate about fraud prevention, NEACH rule evolution, and fostering collaboration within financial institutions.
LinkedIn  

Mary Mumper-Morrison
Education Director
NEACH
An experienced payments expert with 25+ years in banking & fintech, specializing in operations, audit, and regulatory guidance for payments systems.
LinkedIn  

Key Insights
AI's Role in Payments Innovation and Security

 Mary Mumper-Morrison explores the transformative potential of AI in the payments industry, from improving security to streamlining operations. She highlights how AI tools are already being leveraged to enhance fraud detection and support regulatory compliance. However, she also warns of the challenges in change management, urging financial institutions to involve employees in conversations about AI’s integration to avoid resistance and fear of job displacement.
 

The Growing Importance of Embedded Finance

Mary Mumper-Morrison discusses the rapid expansion of embedded finance and its implications for financial institutions. As embedded finance continues to grow, it will likely redefine how consumers interact with financial services and how institutions design their offerings to remain competitive.

Fraud Education Requires a Public-Private Approach

Sean Carter highlights the need for a collaborative strategy to combat fraud effectively. He explains that financial institutions alone cannot shoulder the responsibility of educating the public about scams and fraudulent activity. Drawing parallels to successful public service campaigns like Smokey Bear, Carter argues for impactful, guilt-inducing messaging that ties consumer behavior to the negative outcomes of fraud. By involving regulators, social media platforms, and telecom providers, the industry can drive meaningful change in fraud prevention and public awareness.

Transcript

NEACH - Wrestling Payments – How FinTech, Fraud, and Regulation Are Shaping Payments

 Sean Carter, Mary Mumper-Morrison
 season 2, episode 21

Mary Mumper-Morrison: [00:00:00] Well, since I had a, a significant part in writing the RFCs for both of these new, new rules initiatives, those definitely stick out. One reminder, don't forget, April 1st, 2025, they switched a date on us, so that might not be top of mind, so don't forget. You have to make sure that you respond to those notices of requests for return within 10 business days.

But you know, those were the, the, the proposals that have passed already and that are, you know, going to be happening in, in 2026 are significant. So, you know, that that's a, that's a big deal. And hopefully we'll have an impact on on fraud through the through the network

Joe Casali: [00:01:00] Hello and welcome to wrestling payments. I'm very excited. This is a the last episode we're recording this year. I'm pretty and this year is 2024. I'm excited. Sometimes this time of year, you see a lot of articles, podcasts YouTubes on wrestling payments. What's ahead? We're going to take a little bit of a different angle on that.

We're going to say, how was the year? What, what, what stood out for it for my, my guests today and, and myself? And and then we're going to look ahead. So then we'll do what everyone else does. But I'd like to introduce and, and Sean Carter, president of NIECH and Mary Mumper also of NIECH, Mary, education director.

Could you guys just give a few words of who you are and, and. What's your favorite, who your favorite wrestler is?

Mary: [00:02:00] Ooh, ouch. So I'm pretty old school and my favorite wrestler was George the Animal Steel. So we're, we're going, we're going way back with that one. I, I don't partake so much anymore, but back in the day he was my fave. Maybe a little bit of Rowdy Roddy Piper as well. So, the important part out of the way.

My name is Mary. I'm director of education here at niche and I have been in the financial industry for about 25 years now mainly banking operations, but also a stint in internal audit. Oh,

Joe: I don't want to interrupt, but how did you get into banking payments? Did you, as a child, say I want to be in payments!

Mary: As a child, I wanted to go to law school and become a senator. I quickly learned that I didn't want to go to school for eight years once I started college. So, I worked retail for quite a while. And when I was working at the [00:03:00] Gap I had a, a coworker whose friend was a recruiter for, for Chicago NBD, and I was like, I'm done with retail, and she's like, hey, send me your resume.

So I did, and I ended up in operations, and I have been there ever since,

Joe: Awesome. That's great. I love those stories. And that's, I steal that question from Kevin Olson, but it's a great question. Sean favorite wrestler, and how did you get here?

Sean Carter: Yeah, so my, my favorite wrestler, I would have, I would have thought I would say the rock or one of the, one of those people in that era. But my brother recently, recently reminded me I used to cry when Coco beware would lose a match. So I believe I was a Coco beware fan. This is before I realized that it was scripted.

I'm not going to say fake but it was scripted. And I used to I used to take those losses personally for a cocoa beware. So I got here, I took a really weird route here. So I wanted to be in accounting and finance, but at the time I finished [00:04:00] school, I was still a pizza maker in Boston. And so niche was a lot closer than where I was working, doing accounting.

For my day job to get to my night job. So it just happened that once I got here to niche working for you and accounting Harry Coulson, our CEO and Terry Good and Patty Prester, who's back they all got me introduced to the rules and I just fell in love with interpreting the rules and answering rule questions.

And and that was it. Once I, once I read that rule book the first time I was, I was hooked on payments and. Just to see, you know, kind of the evolution is unbelievable and getting to learn along the way a new payment system every once in a while, like FedNow, RTP keeps you going or when, you know, check 21 came out.

So, it is always something, but it was a very exciting very exciting industry. So, not, I don't think anybody starts out saying I want to be in payments, but once you're in, it is, it's a great industry.[00:05:00] 

Joe: You took the words out of my mouth. I was just going to say, you know, once you're in payments, it's hard to get out because it's such a great industry. I know, I know. That might not sound, it might sound like, you know, you know, being a mortician and some people want to be a mortician, but not me. But maybe if I was a mortician, I'd say, Oh, once you get out.

People are dying to get in. I don't know. Okay. So, let's, we want to talk about this year. I, I can't believe it's December. I was waiting for it to be summer and then I realized summer was over. Lots have happened this year. We started out the year with some rule changes from NACCHA. Big, big series of rule changes.

Took a little extra time to get those in. Couple of different requests for comments, requests for information, and some regulations that came out. Mary, let's start with you. Unless, so Mary has construction going on. So, are you good?

Mary: I, I think, so if you didn't hear anything in my intro [00:06:00] okay, yeah, so right now there seems to be a bit of a lull.

Joe: so what stands out for you open floor?

Mary: Well, since I had a, a significant part in writing the RFCs for both of these new, new rules initiatives, those definitely stick out. One reminder, don't forget, April 1st, 2025, they switched a date on us, so that might not be top of mind, so don't forget. You have to make sure that you respond to those notices of requests for return within 10 business days.

But you know, those were the, the, the proposals that have passed already and that are, you know, going to be happening in, in 2026 are significant. So, you know, that that's a, that's a big deal. And hopefully we'll have an impact on on fraud through the through the network. A couple of the other things that I thought of were the the, the CFPB's passing of the personal financial data rights rule, which is going to have a, a, a massive [00:07:00] impact on financial institutions.

It's already been challenged in court by a couple of trade associations, and then we have the new administration coming in next year. So I have no idea what we're going to be looking at for that in the future, but it's, it's significant at this point. And then there's just the again, the continuing importance of things like AI and banking as a service and embedded finance and you know, those things that they've been around, but they continue to grow and grow and grow and and continue to I guess, kind of make their place in the financial industry.

You know, looking at at how some of of those things have have grown and and, you know, the regulatory scrutiny particularly in banking as a service with financial institutions and their partners big regulatory scrutiny on, kYC and and the impacts within those partnerships.

So so those are. Those [00:08:00] are the, the, the biggies that come to mind for me. And of course as, as Sean also mentioned when we were talking before you hit record the growth of fraud,

Joe: hmm. Just for, just for the audience, if they're not familiar, if, if someone wasn't a payments person and they're listening because they're a wrestling fan what is banking as a service?

Mary: So, so banking as a service is, is really, you know, a a FinTech company or something along those lines. Let's say they want to offer bank accounts to, to their customers and they do not have a bank charter. So, so they can't do that without a partner. So they're going to partner with a financial institution in order to offer, you know, products and services.

And those you know, essentially using the license of their partner. So, so that's kind of the the, the, the banking as a service kind of thing. So if the WWF, oh, wait, it's not that anymore, right? But anyway, the WWE, is that what it is now? [00:09:00] Whatever it is, if, if if Jim McMahon decides that he wants to offer a, you know, very special glow account to some of, you know, their, their their fans, then they might partner with, you know, a local financial institution out there in Stamford, Connecticut.

And, you know, decide that, you know, they're gonna, they're gonna offer this, they're gonna, they're gonna partner with that financial institution. And you're gonna have, you know, these sweet debit cards with, you know, gorgeous ladies of wrestling on it. And, you know, offer all these, you know, maybe you get 10 percent off on, you know, tickets to live events, if you bank with them that type of deal.

But the, the banking as service comes, Into that, that partnership.

Joe: All right, that was wonderful. was wonderful. Sean, you have a lot to keep up with. She has dropped more names in this episode than anyone has dropped in any other episode. [00:10:00] So, for you, Sean, do you agree with some of her observations? Do you have your own?

Sean: Yeah, no, I had a couple of the same things. Obviously, the not to rule ballots that were passed and in an effort to influence or try to reduce credit push fraud in the network. Not just a new risk management framework. And these rules are a big part of that framework. And, you know, to me, the biggest thing is. I'll try to do this in wrestling terms as well. So the the RD, the ODFI has always been the hero heel, and we've relied on them to be everything. But now the RDFI is going to be put in a role where we're asking them to do more. Right. And so I think from that standpoint, this is a pretty big change and it's actually going to, You know, going forward, one of the things that's going to have to happen is operations.

People are going to have to have a better understanding of what BSA people do and BSA people are going to have to have a better understanding of what operations folks are doing. [00:11:00] I agree with the 1033. We just had our member meeting the other day. We had Darren from braid on and, you know, there's, there was a lot of pushback from the industry.

They didn't get what they wanted as part of the. Easing of the proposed rule, which, as Mary mentioned, politically what happens next, but it's almost like 1033 in a way, though, is given permission to every bank to do more with fintechs, right? It's not saying that explicitly, but but what it does do is that the intent is to foster innovation so that we get the under banked and unbanked. Into the system. So, I thought that was really interesting. When you look at it like that, you step back from the new regulation, but you know, there's an opportunity there as well. Fraud to me was it was, it's unbelievable. It's heartbreaking to be really honest. You know, I'm a rules person at heart and you know, we're not to did their strategy.

I'm like, how do you measure this thing? So I started digging in to try to find stats on what. [00:12:00] losses are to see how do you say we're doing better five years from now. And you just read about the trafficking of kids and, and all this other stuff that is all tied to this fraud. It's just, it's really bad.

And this year just seems like every third time you pick up the call for phone from a member, that's what this is about. If somebody had their account compromised or what do we do? How can we help them? And, You know, in a tough economic environment for people to be robbed of their last 1, 500. It's going to be frightening And then I would say one other big thing Mary had mentioned RFCs that came out in the industry But you know the expanding RFC on the expansion of the NSS settlement

Joe: is, what is, can you, again, for the

Sean: yeah, so the National Settlement Service which closes at a specific time every day and, and basically starts a new day which is one of the reasons we don't have weekend for most payment systems.

We don't have [00:13:00] weekend processing for wire or for ACH and you have it for real time, but it's like pre funded transactions. Everybody's accounts are funded in advance. The federal reserve has long as part of the, Improving of the U. S. financial payment system, which part of that was creating faster payments in 2015 they wanted to look at opening that and really creates the possibility of wires on weekends and holidays.

And ultimately, if you can do that and NAWCHA can get a rule passed, you could actually have weekend and ACH. I mean, we're a long way off from that, but That to me, them going out with that comment and having read some of the people's responses has really been interesting to that. So I think those are the biggest things for me.

Obviously AI as Mary mentioned is interesting. Nietzsche is using AI now. We have an AI product for rule books. I mean it, it really is the, the the speed of which that gets talked [00:14:00] about and how banks are looking at it. It's something we'll have to keep, you know, look to the future, keep an eye on that.

But I will say the change management piece of that's going to be important, right? So banks and anybody else that has employees and you're having these backroom meetings about how you're going to use AI to be more efficient. You probably want to include the employees in those conversations because employees are going to start getting really uncomfortable about that. What A. I. Can do because they were there may be a perceived thing going on that your job is going to be lost. I, you know, I don't see that for us here, but I think in financial institutions there's so much fraud that the tools will help. And then you can use the bodies to do everything else that you need to do.

Right now, the bodies are doing too much of the busy work and not enough of the impactful work. So I, you know, it's one of those things can be a negative or a benefit, but. This year, it's been talked up an awful lot.

Joe: I don't think I would disagree. I think [00:15:00] you, you guys covered it all. I have just recently, like in the last three days, put myself on an accelerated course to learn everything I can about A. I. And we've got two sessions this next year on on A. I. I think I think A. I. Is one of those things that people You mention it and they go, oh yeah, I know what that is.

It's Terminator, right? It's Terminator. Or Hal. It's Hal from Space Odyssey 2001. But that's not really what it is, right? So I think there's more to it and less to it. I think there's versions of it. You know, I've watched videos recently where they're basically cloning people. And, you know, I want all the advice from Sean.

Let's make a Sean AI. And we, what we would do is we'd record Sean, and we would take his transcripts, and we'd feed it all into this [00:16:00] machine, and this machine kind of, evaluates the content in there. And, you know, what was that? There was a, there used to be a, there was a joke in there somewhere as far as the stylings of a comedian.

But it would, it would respond to a question based on everything Sean fed the machine. So there's, there's lots of ways AI is used. There's lots of things AI can't do. There's additional issues that pop up, including ethics, right? So if we fed we fed AI all the stuff. The transcripts from a call from my brother, you would have a organized crime AI because, you know, my, my, my, he's from the other side of the tracks.

So ethics, how do you make sure that the information these AIs are doing are right? How do you make sure they're staying correct? And it was really interesting. I [00:17:00] listened last night to a I think it was a podcast. It wasn't a book. I listened to a podcast, and they described it as things AI can do and things AI can't do, and they described it as a circle.

And if you had a point within the circle, that's something AI could get to. If you had a point outside of the circle, say point B, say it's something AI can't get to. But the truth of the matter is, the circle isn't a circle. The edge of, of AI is jagged. It is not a circle. There is not a known universe of things AI can do and things AI can't do.

So, it's really just a new thing that I think people, I'll start the next year predictions. I think AI will continue to evolve. I think financial institutions will continue to experiment. With things AI can do, and I, I predict that, that some of the things will be wrong. Some of the investments would be bad investments.

You, [00:18:00] do you remember when RTP came out, RTP came out in 2017? Half our members said, eh, we're going to wait. Let's see what happens. FedNow came out just 2023. Now everyone's made the decision, let's move on. I think there's going to be a wait and see approach to AI for a lot of things. And the only other thing I would say is fraud, I think fraud is definitely going to continue at the rate it's at, which is a very bad rate or maybe even accelerate.

This thing, you know, the, the business of fraud has literally turned into a business. There are. You know, the post office is doing things to get rid of those keys that keep getting stolen and replace it with keypads or some other security measures. But there are vans that go around and steal the mail.

They have people sorting through the mail and saying, what can we wash and what can't we wash? It's an organized crime. [00:19:00] And AI, you know, the things on my accelerated course, AI is being used for fraud as well. So, I think fraud may become our, one of the biggest issues next year for us to fight. Let's go back to Sean.

Why don't you start out with anything you think for next year?

Sean: So I don't have predictions. I have hopes and wishes and dreams for next year. So one of them is I really do hope that as an industry, we around fraud, we reimagine what we're doing, what we're doing to educate people, what we're doing to try to prevent it, what we're doing to even define it the same way is just not working.

So I, you know, I give our members a ton of credit. I know locally we have members in my, in my town, they go to the community center, they send a branch person and, you know, we got 20 people in a meeting and they're trying to teach the people about scams. You know, that's great for the 20 people, but it's a town of 30, 000.

And, you [00:20:00] know, even when Niche does fraud sessions for a bank's customers, they're great events. It's awesome to get to meet the people. You know, we're celebrating. Hey, you got 50 people in the room. That's a great thing. But you ask them and they have 1500 corporate clash management clients. So I just think we need to reimagine how we try to, you know, whether it's public service campaigns, you know, you know, I'm on the smoky, the bear kick on public campaigns, because when you research the smoky, the bear campaign, it actually helped reduce forest fires.

But if I were, if you go back and remember the first versions of it, it was pretty graphic what they showed you on those commercials to make you think, right? Like a burning squirrel or a deer that was burnt, you know, it makes people think about their behavior and the problem we're having with a lot of the fraud because the weakness is the customer, banks, credit unions, they have to tippy toe on how they can talk to people, right?

Like they can't just [00:21:00] say, Hey, you're a disaster with your iPhone. I'm going to pull back. I'm going to pull all your banking ability away from you or, you know, you corporation. This is your 5th bad check. You can't write checks anymore. That just doesn't happen right? And for a very good reason, but we need to as an industry support banks and credit unions better so that we don't have regulators pointing the blame at them.

And we don't have the expectation of this getting fixed all on banks and credit unions. It's just, it's not fair. You know, I think social media plays a role in this. The telecoms have a role to play in fighting fraud. You know, I just had three this morning. Scam likely. Well, then don't let the freaking call go through, right?

If you know it's a scam, stop it, right? Cause I might be gullible to fall for it. So I do think. There's an opportunity for organizations like Niche and some of our partners to do better and help, and, and I know that's going to be [00:22:00] one of our corporate focuses. The other place I'd like to reimagine for our members is, think about all these new things, like Mary talked about the great impact of 1033, and let's say it remains as is, as written, right?

Let's get over that new regulation and start thinking about, okay, this is kind of a green light. What can we do with FinTechs? Is there products and services we can build around banking as a service or information sharing, right? That would that would help us a comply with this regulation but maybe gain a competitive advantage.

And I think the same is true with the NACHA changes as well, right? Like just being able to prevent fraud by catching transactions may require some products and services that can be developed for you to help your customers look at or customers and members look at transactions in the warehouse maybe and say oh my god I don't I don't I shouldn't have did that right because right [00:23:00] now they see it the day of settlement and everything's already happened and so I just want people to think about you know these regulations nobody particularly likes regulations right but I there's enough going on where we need to, regulations need to happen sometimes, but they don't always have to be a negative result to the institution.

I think that wish is that people rethink it. And my last wish is everybody get on either the fraud classifier or the scam classifier from the Fed, because you're not going to have good public policy and rulemaking and anything else until we all define fraud the same way. Because that's going to drive messaging.

That's going to drive tools and products and those two tools I mentioned. I mean, I'm sure there's others, but we've got to find a consistent way to define, you know, first party fraud, third party fraud, unauthorized versus unauthorized. We have to start talking about it [00:24:00] the same way, because when you start attaching data to the losses and the types of scams, you know, you could say, hey.

80 percent of it is romance scams. Great. Start working with the dating apps right now. You have a direction where you can go to have an outcome. But if we just say, know, 700 million has been lost in corporate fraud because of payments. Yeah, but where is that? How do you start attacking that? That's too big of an apple without knowing where Some of the weaknesses might be.

So those are my wishes, not predictions for 2025

Joe: Sean, can I? I just want to follow up with a second. Let me follow up with a little bit of education. I think I found myself falling into the trap of scam fraud. It's they're the same thing. The other day during a conversation, which I immediately knew, no, no, no, that's wrong. You know, so when you think of, and these are both available from the [00:25:00] Federal Reserve, and they're just tools to really get us using the same words and understanding the same problems.

When you think of a fraud, and, and this is a question, do you think this interpretation is wrong? When you think of a fraud, it's, it's literally. An armed robbery in my mind. Someone stole a check and changed it. Someone hacked into your account or stole your account information and is transferring money out of your account.

Those are frauds. Those are, those are, you know, hackers, if you will. Going into the, the right interlopers I always think of. So I don't use interlopers 'cause I always think they have antlers, but going into the, the some sort of banking system or, and actually doing something that, that, you know, would be considered a crime immediately, you know, it's a felony.

The scams are. The scams are I'm gonna fool you into you doing an action. So, look at it, I have these little [00:26:00] kittens, they're so fluffy, send me fifty dollars and I'll reserve one for you. I, you know, I'm in love with you but I can't get out of this country because my visa, I need six hundred dollars for my visa, could you send me?

600 for my visa. So is that along the

Sean: Yeah. So that's how I look at it. So, I mean, you may have others that comments on this podcast that look at it differently, but that's exactly how I, I did in my own head. I distinguish it. And the reason I do it that way, because when you start talking about the solutions Right? You don't want to talk to a customer about raising the level of encryption and security on their iPhone.

You're going to say, hey, you need to be a little more cautious when somebody is offering you a product that you can't see, feel, and touch. Right? As opposed to if I get my account taken over, when the bank's trying to help me, that's a different conversation than, Sean, you tried to buy a cat. And to me, I think you have to separate those.

I know others in presentations, I've seen that a people I look up to [00:27:00] and a great, they don't necessarily do it that way. Cause ultimately the scam does result in a fraudulent payment. But I think when you are trying to, trying to solve the issue, you have to look at it in, in those two buckets, right?

Like there was a difference between an account takeover and interloper stealing my bank account. Versus somebody deceiving me or making me do something. What's that new fancy term in the rules? Oh that behavior word and fraudulently induced behavior or something.

Joe: Yes. Yes. I just heard something on that.

Sean: Yeah, so I I do think there's a a difference there and it is important especially for banks and credit unions when dealing with How do you fix it going forward for?

The customer remember it's important to You to know that there is a difference and how you talk to them is going to be different. Handing me a NIST cybersecurity framework because I bought a kitten is not going to solve the [00:28:00] kitten problem, right? And vice versa, right? If I, if I had an account takeover and you tell me, give me a piece of paper about the Canadian lottery, like that's irrelevant, right?

I need the NIST paperwork and that person needs to talk the tough love talk about Be careful. So to me, that's, you know, I would do it that way. Mary, I'd be interested to get your, as a former BSA dealing with this at an institution, you know, how do you look at scam versus fraud? Do you put in the same subset?

How do you, how do you do

Mary: I, I, yeah being the love slash hater of Reggie that I am in my mind, I see authorized and unauthorized and when the person actually physically makes the payment themselves and says, Oh, I want that kitten or, Oh, I want to do this or, Oh, I love you. Here's 8, 000. That's an authorized transaction and that's a scam.

And when, you know, [00:29:00] another party actually performs the transaction you know, tricks somebody into giving up their user credentials, and then they go in and do the thing that's unauthorized. And, and, and I bucket that in my head as fraud. And, and that's just how my brain my brain works to to think about that. And

Joe: to, I want to move on to Mary, but I have questions. One more brilliant thing from Sean. I want to hear because I've heard it in our conversations and you touched on it in your hopes and wishes. The idea of making things, making people think about things different. Can you tell the full story about Smokey?

Smoky, the 

Sean: Yeah. So, so if you look at if you look at the U. S. Overall we have a history of doing public service campaigns to drive try to solve problems, right? So the biggest failure obviously was the say no to drugs, right? That was a big push. This is your brain on drugs [00:30:00] and and and people still they didn't respond to it, right?

It actually ultimately to point now where we legalize some of the stuff we were saying don't do. back then, almost like a give up. And some of that ties to the individual's pleasure, right? People enjoy that feeling or, you know, they're out with their friends, whatever. No judging. When you look at us, the two other really successful ones there's one on the drunk driving, right?

Which stats have shown that as, as the head of impact, which used to be mad,

Joe: Mm hmm.

Sean: and I'll, and I'll give two examples of why those are so effective. Number one you know, on prom night at most high schools, they come and do a demonstration and they blow up a car. And they say, this is what's going to happen if you drive drunk.

Unless you're pretty foolish, you're going to go, okay, I'm not signing up to do that. I'll figure out another way. And then the other thing they do is the commercials were always heartbreaking. Like, a [00:31:00] family was just taken away or somebody, right? And so it for most people, there's still people that are going to go over the edge and we're never going to get fraught to zero.

But if you can tap into the good of the majority of people by saying, Oh, my behavior here could lead to this. That's why they're effective. And the thing with the smoky, the beer was interesting because the people that are in the outdoors that go camping and stuff, if you ask them their favorite thing about life is the outdoors. so this was about saying, Hey, we want you to enjoy the outdoors, but your behavior in some cases is, is killing the very thing that you love. And people start stepping back and going, Oh wow. Yeah. You know, maybe I'll be a little bit with my barbecue or when I'm camping, I'm going to do a better job putting out the fire, you know, whatever those things work.

And so you can kind of, you can kind of see the, The areas that they did, they kind of made you feel guilty, right? Which was a, which was a need, right? Because [00:32:00] in order for you to change behavior, you have to think something is wrong, right? Like, I mean, the biggest thing to, you know, people always joke about when you go to the gym, when you go to the doctor, they kind of cushion and be like, Oh, you're a little overweight, you might want to go to the gym.

How different would it be is you're going to die in five years unless you go to the gym?

Joe: Different.

Sean: it proved more effective, right? And so the thing with the I. T. Use cases and like be better with technology, I think part of the challenge is gonna be there is a pleasure component to that. People are on their devices.

They enjoy watching the videos, so I don't know if that necessarily brain on drugs type of thing is gonna work. However I don't think anybody that plays roadblocks or watches videos on their lunch breaks wants kids to be sex trafficked. I'm just, I'm going to throw that out there. I think 99. 9 percent of those people would be heavily against the result of what happens from misuse of links and things like that.

[00:33:00] So I think there is an opportunity to do messaging where you are tying the end result to the behavior that would make people Just stop because what we know from these for scams is with a little bit of awareness They're not overly complicated like to me I'm still impressed with things like account takeover in the business email compromise There's a little bit of technology that you have to do and you have to understand it a little bit to make it work But these scams like with the puppies These scams, I'm a card collector and I've, you know, I see a lot of these fake sales on Facebook about collections or I have a Ken Griffey rookie card for 20.

It's like, you know, I try to get on there and tell people don't buy this. This is obviously not a good card, but people do it. You'll see, I'll just DM you my payments. Like, so but a little bit [00:34:00] of, Hey, you know, not everybody's a good person. You need to be careful with this technology because here's the benefits of the technology.

Here's the pleasure you derive. Here's the downside. And I just think that's hard for banks and credit unions to be the messenger alone on that because when a bank hosts an event, I don't care who you are, people start thinking, what are they going to try to sell me? Right? Even though the events clearly welcome to everybody, you don't have to be a customer.

We're just going to teach you about How to help your family members and your elderly relatives not fall for scams. It's just not working. And so I think you have to look at what has been successful before with the American public. You have to lean on what has worked in the past and try to avoid what some of the pitfalls may have been with the other things.

And Joe, you know, I've known you since I was, what, 16? You know, I don't think anybody I hung around with watched a commercial and was like, Oh, my [00:35:00] brain's an egg. I'm not going to do that. But if you had said the person's getting that money and then they're going to traffic people over borders or it's going to lead to guns or people building a nuclear bomb in another country, that might, that might assuade some folks early, early nineties from going down a different path.

But, you know, again, it's not a knock at what they tried to do. It's very noble to try to get people not to do drugs because 

as fun as they might be for some people, they're probably not good for you in the long run. and I'll stand by that prediction. That's a prediction. but yeah, so, so to me, I think that's, you know, that's the thing I worry about is that the regulators and everybody involved is just putting this on.

the FIs. And it's, to me, it's wholly unfair. And the, the, the banks are in the middle of it. Banks and credit unions are in the middle of fighting it every day. They don't have the time to do what needs to be done. So I think that's where the [00:36:00] industry has to help. And you know, we'll talk to our members about something that NIECH is looking at and, you know, working with a company to do.

We'll, we'll get, you know, we'll see if there's an appetite, but I just think we have to look at it differently. And this is not something NACHA can fix with rule changes, or not a regulation that's gonna come out that makes you not buy a puppy, Joe. 

It's just not gonna happen. 

Joe: Full up on

Sean: yeah, you like, you like, 

yeah, your wife loves animals.

I love puppies too, you know, it's, 

so I just think that's, that's something that, We can do better. I think we can do it, honestly. Not to zero, but I think we can reduce a lot of the fraud.

Joe: no, I think that was that's great insight. Hopefully, as people think about how to, Solve fraud they keep that story in mind. How do we make it impactful? Mary so I didn't know this was the hopes and wishes episode or do you want to go with a straight out prediction or are you just curious about something next year?

Mary: Can I first just add a [00:37:00] couple of tidbits on to what Sean was talking about? Because I agree wholeheartedly and one of the things that that I realized when I talked to people who aren't in the payments industry and you know, even some folks who are bankers but aren't necessarily into like the payments piece of it is A lot of folks just think that these, these, these, these scammers are, you know, bad acting individuals or they're like here in, in like the U.

S. Like when I tell people, like, don't answer those stupid questions about what your first car was and what your first job was. Well, how will they use that? And there's no awareness that there are literally like factories. Of trafficked people that are actually doing these these scams in in in different countries.

And there are folks that I follow on on LinkedIn where, you know, the post one woman recently visited, um, near the [00:38:00] Myanmar border and had like photos of these compounds where these calls are being made from, and these posts are happening. And it is literally an industry. Like you guys mentioned, but I don't think there's.

awareness of that at all. You know, and the fact that they're actually using trafficked people to do this. And, and, you know, that's something that I, I feel like should be part of, of education to the general public. Like, here's what's happening here. And this is why they can actually take those answers to your Silly Fun Facebook quizzes and tie them back to your email.

And, you know, if they've, if they figured out, Let's say you know what your email address is and they've found where your password elsewhere has been compromised and you probably use the same password for everything like so many do, then, you know, they have a way into your bank account and now [00:39:00] you've given them the security.

Questions you've given them the answers to those if, if those are still used you know, and, and you're, you're unlocking this, not, not realizing how. Massive this industry is and, and that it's not just a couple of people who are putting these things together. It's not just, you know, some, you know, smart people who are misusing their intelligence to, to get your money.

It's so huge and, and frightening. So I think, you know, that that's part of the education that needs to happen, you know, for the public generally to realize, like, this is actually what this looks like you know, whatever's in your head, you know, the Nigerian print scam and all of that. That's that's that's gone.

You see these emails now, and they are well written. You know, you can still find clues, but but they're not, they're not going to be as, you know, Easily spotable and and and some of the scams, like the ones that actually come through, [00:40:00] you know, text where it's actually in the text string of your financial institution and legit text.

You've gotten before. Like, it's there's so much and and agreed, you know, a lot of these, you know, stem from. You know, loneliness, especially when we're talking. I hate the term, but the pig butchering scams where these scammers make you trust them and you actually think, you know, them because you've had all these conversations and yada, yada, yada you know, banks are not Um, bank employees are not social workers, right?

They can't deal with that underlying human condition of loneliness and need for connection that these scammers prey upon. You know, banks are not going to be able to resolve this just by saying, Do you actually know the person you're sending this money to? You know, I've seen tons of different posts on social media where people are just up in arms because their bank asked this, and it's none of their business, and they're just going to lie to them.

And then you see a handful of, [00:41:00] you know, commentary underneath that says, well, they're asking that because of how many scams there are and to prevent people hopefully from losing, you know, hundreds of thousands of dollars. You know, they can only do so much. So just piggybacking on what Sean said, like it does in order to tackle fraud in, in any, you know, way, shape or form, especially when it comes to these scams and, and people preying on, on individuals is that it, it needs to be a wider net.

It can't just be financial institutions trying to, you know, stick their, stick their finger in a dike and, and stop the, the dam from, from bursting. It just, it's impossible. So those are my thoughts there. But, but I do, I think it's brilliant that they understand that, that, you know, and then just the old adage, if it's too good to be true, it's, it, it is. You know, and, and to know that when you, when you fall for something like this, when, when you're, you know, tricked into [00:42:00] something like this, that, you know, here are the far ranging, you know, consequences you don't want people to feel bad because sometimes they are really good scams and, you know, sometimes people are just really vulnerable to these things but, you know, maybe those who should know better you know, will, will think twice. You know, and and that is hopefully enough and and I know the financial industry hates friction in payments and so forth and so on. But if if that friction just, you know, causes a minute or 2 or, you know, to to think twice. Maybe it's not such a horrible thing. And hopefully the next time I go to, you know, FPC, I won't get beaten for that.

I'm kidding, but but, you know, it is a, it's a thing. I worked for a FinTech for a decade and friction was not something that we wanted to see in our product. You know, you didn't want that lag. You wanted everything to, to run smoothly. You didn't want any hangs, hangups, but, you know, sometimes it [00:43:00] might be, it might be helpful

Joe: Yeah. No, that's great information.

Mary: So on to 2025. I honestly have no idea. Like, I, you know, who knows what's going to happen. It's, it's a crap shoot to me of, you know, you know, with the incoming administration, what we're going to see there's going to be a whole lot of change. And I think people are hoping for a rollback on some of the CFPB regulations and things like that.

I have no idea. But I will say that I definitely expect to see more growth in, you know, fintechs and banking as a service and as particularly embedded finance where you have, you know, like, I can buy something when I'm on Instagram. I can buy something when I'm on Facebook. That's, you know, embedded finance.

More places where you'll be able to have that kind of connection to, to do these things. I expect to see that grow. I expect to see AI continue growing but, you know, [00:44:00] I, I, regulatory wise, I'm, I think is anxious to see what happens as the next person. 

Joe: Do you think that'll happen right away? Or do you think we'll be watching it all year?

Mary: I think there's probably enough friction that it might take a minute. But. I think movement towards will start happening, but I think there might be still enough friction in that process to, to slow things down. But we'll, we'll see.

Joe: Interesting. Super interesting. Yeah, I, I certainly don't have anything to add. Any parting words?

Sean: I'll just say that, you know, as, as every year, the last ten years has been an indicator, there will be something next year that we didn't see coming, whether it's on RFC or Product that that terms or use case that takes everybody by surprise. you know, I just think [00:45:00] our financial institutions just have to be always on the lookout for those opportunities.

And so there'll be something next year that we're all talking about on this one. That's it. Oh, wow. We didn't see that coming, but it'd be nice if fraud went down, but I, I don't suspect we will see that next year. So

Joe: Yeah. Mary 

Mary: you know, I, I, I, I do, one thing I hear bubbling up is that, that we might see some ease of operation for for crypto. So that, that could be interesting. Oh

Joe: again. So much so much there is a crypto czar. I don't ever remember there being a crypto czar So there is now a u. s. Crypto czar with it will be

Sean: Joe and Mary, you know, it's interesting. You know, we didn't even get to that's a huge change in 2025 is the wire system rolling over 

the Fed rolling over in

Mary: shoot, [00:46:00] we

Sean: No, I mean, that's just, isn't that crazy how much stuff is actually going on and you have this massive change that didn't even get to the conversation.

So, that, you know, it that just shows the industry. that we're in where you can have all this. And oh, by the way, we're dumping this massive change onto everybody for wire processing. So I would my prediction is that that's going to go as well as people think it's going to go. So if you think it's going to go good, it might go good.

If you think it's going to go bad there may be some hiccups, but you need to work with your cores, talk with the Fed, make sure you're ready for that. You have, you have to be ready for that and all the downstream. So, yeah, that, that's one thing we didn't get to Joe. That's

Joe: no long story short Sean and our board or in communication with the Fed and there's gonna be a survey that goes out on How it's going. I, I try to be quiet. I'm like, at heart, I'm an ACH guy [00:47:00] and a wrestling fan, but an ACH guy. So I try not to comment on, you know, oh, wire. But it could be a Y2K moment for wire transfers on that one day where things just stop.

So 

Sean: Yeah. So luckily for us at niche, we have a fed reserve board rep who got our member board members talking about this and just the uneasiness in the room and where they were at, not, not knowing necessarily where their vendors are at. There will be a survey that is going to go to all fed line participants.

And so, Shout out to the board for driving that. But their honesty in that room is what made that happen. So it's it's a great thing when people can just say, you know, I'm not I'm nervous. And that's okay, right? Because then you start asking the right questions or you get to the people that can get the right question.

So if any of the members have a Question on the Fed roll Fed changing over in March, please reach out to us, we'll get you to the right people if we can't, [00:48:00] if we can't help.

Joe: Just wrote down an episode, so we probably need an episode on that too. Yeah.

Sean: So,

Joe: All

Sean: that's like when they merged WCW and WWE, that's a bit, like if you were to consider what the moment size is, right?

Would you call it that?

Joe: I don't know, that was, I have, I have feelings, I have feelings.

Sean: Joe's still mad about 

Joe: still mad about

Hulk Hogan, man. Still mad. Sorry. I can

Sean: to do a episode with you and a therapist when they ask you what's the worst day in your life and you say, oh, yeah, I was in Hong Kong and joined the NWO.

Joe: Yeah, it's bad. Sorry, Mary. Did, did Mary any, any other things?

Mary: I I don't, I don't think so. Happy holidays?

Joe: Happy holidays.

Sean: holidays to everyone.

Joe: It may be right around New Year's this episode comes out, so, Happy New Year as well. Yeah. Excellent. Well, thank you for joining me. Mary wins the [00:49:00] prize. As the best wrestling payment expert ever on the show. Thank you, Mary. Great

Sean: Tough to keep up with.

Joe: Yeah. Yeah. And Sean, you get the merits for saying scripted.

Sean: Ow.

Joe: Just saying.

Sean: Okay.

Joe: Alright.