1 2
INTEGRATED DECISION MANAGEMENT and to identify industry trends. If apparently normal sums
SYSTEM are withdrawn from many accounts belonging to a customer
by the same type of payment system, it may indicate that the
REFERENCE TO A MICROFICHE APPENDIX individual is involved in embezzlement or some other type
A microfiche appendix, comprising a flowchart listing of 5 of fraud. Similarly, if several customers in a single industry
me computer program implemented in the present invention, request similar transactions at the same time, it might
is included in the application. indicate an important industry trend that could affect the
bank. Tracking groups of accounts to spot these trends is
BACKGROUND OF THE INVENTION impossible if done on an ad hoc basis, and no system
1. Field of the Invention io currently provides an automatic means for tracking these The present invention relates to financial business systems types of trends.
and, more specifically, to data processing apparatus for Also, because of recent changes in Federal banking
controlling risk in a multiple account system. regulations, banks need to have the ability to assess charges
2. Description of the Prior Art for the use of daylight overdraft (DOD) funds. DOD funds Currently, risk in the banking industry is controlled in an 15 316 faaai used ^ a customer in excess of funds in the
ad hoc fashion on an account-by-account basis. The funda- account during a &ven banMng ^ corporate mental element of risk is exposure, the amount of funds customers use daylight overdraft funds to allow them to disbursed by the bankin excess of the funds held by the bank carry oa business without having to keep a large amount of for a given account or group of accounts. When a bank w inactive on hand at a bank t0 cover ^ of *** receives a request for a transaction from a corporate 20 transactions mat may occur during a single day. The corpocustomer, the bank's computer system examines the account ration wiu essentially borrow DOD funds and provide funds to which the resulting transaction would be posted, if to cover D0D usage by &e end of ±e ^ Currently, allowed, and determines if the exposure resulting from the because of me Acuity of tracking DOD usage, banks are transaction would exceed a predetermined exposure limit for unable t0 assess char§es for D0D usa§ethat account If the exposure limit would be exceeded, the Many types of transactions occur throughout the processcomputer system alerts an account officer who then decides ing day where the transaction is known at a given time, but whether to authorize the transaction. The officer's decision does not become effective until a later time. This is known may be based on several factors, including past experience as a value dated transaction (VDT) because the transaction with the customer, an understanding of the context of the has no financial value to the target account until the time transaction request and a knowledge of the customer's other specified. One example of a VDT is a direct deposit payroll accounts. transaction, where the transaction is reported to the bank
If the officer desires knowledge of the customer's other Prior t0 &e settlement of the transaction. Currently, many
accounts, he or she must access each of the accounts banks wfll process VDT's upon receipt, posting funds to the
individually and tally up the balances (and exposures) for 35 account prior to settlement. This situation ties up bank funds
each account. While the officer is deciding whether to in 311 unproductive waiting cycle. Furthermore, even if the
authorize the transaction, new transactions may be received bank does not process VDT's upon receipt, it would be
by these other accounts, thereby changing the overall expo- useM t0111(5 bank t0 ttack ae projected exposure caused by
sure of the customer and causing the officer's decision to be ^ ^ P"0110 ^ actual settlement of the transaction,
based on obsolete information. 40 U.S. Pat. No. 4346,442, issued to Musmanno, discloses a
Furthermore, banks usually assign exposure limits to each data processing system for securities brokerage and cash account on an individual basis. If a customer's overall management that supervises, implements and coordinates a exposure is relatively low, yet the exposure limit for one of margin securities brokerage account, short term money its accounts is exceeded, the bank might deny a requested market funds and subscriber-initiated use of electronically transaction to that account. In this situation, the bank's risk 45 responsive credit/debit media and checking systems. Subin otherwise allowing the transaction would be relatively scriber expenditures, effected as by charge card use, check low, yet the bank would lose the profits it would have made and cash advance, are applied on a hierarchal basis against on the transaction and would also lose the goodwill of the the subscriber's free credit balance, short term investment customer. Therefore, with some customers it is desirable to and the lendable equity of his securities account. On a assign relatively high exposure limits for the customer's 50 periodic basis, received card charges, check, securities and individual accounts and an overall exposure limit for all of deposit transactions for the ensemble of account participants the customer's accounts taken together that is less than the are verified and employed to compute an updated credit limit sum of the exposure limits for each individual account In f°r each subscriber. The transactional data is reviewed this way, a customer could request a transaction that would against predetermined norms to detect abuses. The short increase the exposure to one account beyond the ordinary 55 term investment position of each account is modified as exposure limit for that account, yet the transaction could still necessary to permit money market or comparable earned be authorized if the overall exposure limit were not yields on the account free credit cash balance, exceeded. U.S. Pat. No. 4,823,264, issued to Deming, discloses an
Implementing such a system on an ad hoc basis would be electronic funds transfer system that assures that funds to be difficult however, because corporate customers frequently 60 electronically transferred are actually present to be transmaintain several, even hundreds, of accounts with a given ferred. This is accomplished by sending both the debit side bank. The amount of work involved for an account officer to and the credit side of the transaction as described in autotally the customer's total exposure is overwhelming and the mated clearing house records to a payor's financial institurisk of making costly mistakes, either to the bank or to the tion or data processor and comparing both records to assure customer, would make such a system difficult 65 the funds are present before releasing the funds to a payee.
It is also useful for banks to be able to track exposure and None of the above-described references disclose a system
other conditions in groups of accounts in order to spot fraud for conttolling risk in the banking industry among related
