Originally published on bankdirector.com
Fraud and scams typically reach the board as risk metrics and loss figures. For customers, they arrive as a stressful moment when the bank’s promises are put to the test.
Quavo’s new Trust in Banking consumer research finds that nearly four in five consumers have experienced some form of scam exposure. More striking, nearly 70% say the way their institution handled the resolution had a bigger impact on trust than the fraud itself — that’s nearly an 8-point increase from Quavo’s 2025 report. And 72% say a fraud experience affects their confidence in the institution’s other services.
Customers don’t think about organizational charts or system architecture. They’re watching how easy it is to report a problem, how many times they are asked for the same information, how long it takes to see a credit and whether different touchpoints tell the same story.
When the process feels slow, confusing or inconsistent, customers experience the seams between compliance, risk, technology, operations and customer experience. Our research shows that roughly 59% of customers say they are likely to switch institutions if the process is overly long and tedious.
Customers who have a poor dispute experience are less likely to add a new card, refinance a loan or move additional deposits, even if they never formally close their accounts. A straightforward path to recovering funds or securing an account reveals how well the bank’s leaders work together.
Fraud Dispute Processes Expose Leadership Gaps
Most banks have invested heavily in fraud controls, rules and monitoring. Quavo’s State of Dispute Management Performance Report shows where there’s impact for bank leaders: 61.3% said fraud handling had a meaningful impact on their loyalty, including 26.1% who said the impact was extreme.
The report also finds that the average institution loses 56% of disputed dollars, while institutions at the upper end of the benchmark recapture up to 97%. The industry average for issuing provisional credit is 10 days, but some institutions do so in less than one day. Some institutions also resolve disputes three times faster than the industry standard.
On paper, those differences look operational. In practice, they reflect how leadership has allowed dispute workflows to evolve. In many banks, compliance sets policy to meet Regulation E and Regulation Z, while investigators still often rely on email threads and spreadsheets to interpret those rules. It’s all too common for banks to maintain systems of record that do not communicate well, forcing operations teams to build manual workarounds. Customer experience teams are left explaining a journey they neither designed nor controlled.
Fraud Resolution Is a Leadership Stress Test
Fraud and scam resolution are one of the clearest tests of leadership alignment a bank has. It sits at the intersection of trust, regulation and growth.
Three questions are particularly revealing for bank leaders:
- Can compliance meet its obligations without stalling innovation? Reluctance to issue credit quickly, even when regulation allows it, can indicate that data, rules and workflows are not aligned rather than a lack of regulatory clarity.
- Can technology reduce manual handoffs and connect dispute workflows across existing systems? In top performing programs, dispute management is handled through a modern workflow layer on top of the existing core, rather than a patchwork of legacy screens.
- Does operations treat customer trust as something worth measuring? Institutions should track days to first credit, recapture, recovered dollars and dispute-loss performance and connect those measures to customer trust and sentiment.
If management cannot answer these questions with data, leadership misalignment is likely. Customers should not spot the cracks before leadership does.
What Role Board Oversight Bodies Can Play in Dispute Resolution
Boards can ask bank management for a concise dispute-performance dashboard that includes days to first credit, fraud and billing loss rates, recapture, recovered dollars and the share of disputes handled automatically. Management should show performance relative to relevant peer benchmarks and present a cross-functional plan spanning risk, compliance, technology, operations and customer experience. Trust and satisfaction data, specific to fraud and disputes, should be part of the same discussion.
Improving dispute workflows may involve reducing manual handoffs, connecting existing systems and applying targeted automation where it adds value. Bank leadership committees can reflect trust and recovery outcomes in executive and business-unit incentives. Reinforcing resolution as a shared responsibility positions banks to catch emerging risks earlier and present a unified brand to the market.
Fraud and scam disputes will continue to test banks. For bank board and leadership teams, the resolution experience offers a practical agenda for improving oversight, coordination and customer trust.