Fraudsters rarely hit just one bank. They test a scheme at one institution, then move to the next. A new federal tool is meant to help smaller banks spot those patterns sooner.

What happened

On October 6, Comptroller of the Currency Jonathan Gould unveiled a tool that lets community banks report suspected payment fraud directly to a task force at the OCC, the federal regulator for national banks, American Banker reported. Information reported through the tool will be shared across institutions.

Gould announced it in a speech to community bankers in Minneapolis, calling them "truly the front line of defense against fraud." He said non-mortgage fraud in Minneapolis doubled between 2020 and 2024.

The OCC hasn't published full details on how banks sign up or what data the tool collects.

How bank fraud-sharing works

For years, banks have been cautious about telling each other about suspected fraud, partly out of fear of privacy lawsuits. A provision of the USA PATRIOT Act, known as Section 314(b), offers a legal safe harbor: banks and credit unions that opt in can share information about suspected money laundering and fraud with each other without that liability.

Regulators have been pushing banks to use it. In June, the Treasury's Financial Crimes Enforcement Network (FinCEN) clarified that the safe harbor covers suspected fraud even before it's proven. In July, the OCC and FDIC encouraged banks to opt in.

The new OCC tool builds on that. A community bank that spots a scheme can flag it to the task force, which can warn other banks before the same fraudster strikes again.

Why community banks need help

Big banks have large fraud teams and expensive software that watches millions of transactions for patterns. A small bank with a few dozen employees doesn't. Fraudsters know it, and smaller institutions are often targets for check fraud, fake business accounts and payroll schemes.

The scale is large. FinCEN data show financial institutions reported more than $2.5 billion in suspicious activity tied to unauthorized employment schemes alone in 2025, according to American Banker.

Why it matters

Fraud prevention mostly happens out of sight, but customers pay for it, through losses, higher fees and the hassle of frozen cards and blocked payments. Sharing information across banks is an efficient way to stop repeat fraud, because a scheme caught at one bank can be blocked at the next.

There are trade-offs. More sharing means more of your transaction data moving between institutions and government task forces. And faster fraud flags can mean more legitimate payments held for review. How the OCC handles privacy and errors will matter as the tool grows.

What to do if you're scammed

Speed matters more than anything. The sooner you act, the better your chance of getting money back.

Call your bank immediately. Use the number on the back of your card or on the bank's official website, not one from a text or email. Ask the bank to stop or recall the payment and to flag the receiving account.

Change your passwords for your bank and email, and turn on two-step verification.

Report it to the government. File a report with the Federal Trade Commission at ReportFraud.ftc.gov. For online scams, you can also report to the FBI's Internet Crime Complaint Center. These reports help investigators connect cases.

Put a fraud alert or freeze on your credit if the scammer got personal details such as your Social Security number.

Watch for recovery scams. Fraud victims are often targeted again by people promising to get their money back for a fee. Legitimate agencies don't charge to help.

What to watch

Watch for the OCC to publish details on how the tool works and how many banks join. Also watch whether the FDIC and Federal Reserve set up similar channels for the banks they supervise.

Sources: American Banker (Oct. 7) · FTC ReportFraud · FBI IC3

Beyond the Bank is for informational purposes only and is not financial, legal, or investment advice.

Get Beyond the Bank in your inbox every Monday. A free, plain-English briefing on AI, banking alternatives and the new rails under your money. Read the latest issue or subscribe free.