Risk Management Firm Sardine Announces SardineX, a Consortium to Curtail Payment Fraud

Sardine announced the formation of SardineX, an industry-wide, independent consortium to curtail payment fraud by bringing together established financial institutions and emerging fintech organizations to establish trust across multiple payment rails.

Founding members reportedly “include Chesapeake Bank, Visa, Airbase, Blockchain.com, Alloy Labs Alliance, iLex, and Novo, with more members expected to join in the coming months.”

The consortium brings together established financial institutions, “including banks and card networks, as well as emerging financial technology organizations, such as neobanks, payment service providers, and digital asset exchanges, to address considerable fraud and compliance challenges stemming from novel payment methods. ”

The shared goal is “to provide real-time technology, under a privacy-oriented data-sharing framework, to establish the credentials of senders or receivers of funds no matter the rail on which the transaction is conducted.”

Soups Ranjan, Sardine co-founder and CEO, said:

“This consortium transcends the financial system unlike any created by the private or public sector before. How we move money has fundamentally shifted over the past few years, and the only way we can close the massive gaps that fraudsters leverage to hurt shared customers is to improve communication between parties who facilitate payments today.”

The consortium was “developed after the emergence of real-time payments, including the mainstream adoption of peer-to-peer (P2P) payments in the United States, which had numerous fraud challenges.”

The rapidity of payments “was convenient and made recovery difficult in instances of fraud or mistaken transactions.”

SardineX will offer “a shared database where industry-wide participants can access fraud or compliance-related data on any entity that transacts across financial services.”

Participants will query “this database in real time to retrieve and incorporate this data within existing infrastructure and risk management processes to better assess that entity.”

D.J. Seeterlin, Chesapeake Bank’s Chief Innovation Strategy Officer, said:

“By working together, we can improve fraud detection and recovery so that we can continue to innovate in the payments arena and keep them as a part of everyday life. We’re proud to be a founding member of the consortium Sardine spearheaded and believe this effort will deliver on greater societal good to curb fraud and keep money where it belongs.”

How The Consortium Works

Any organization that “initiates or facilitates money movement can be a part of the consortium,” which will operate based on the following:

  • Sardine’s network of activity and risk-related signals will serve as the foundation for the shared database
  • Universal identifiers (UIDs) will be created for any entity transacting with Sardine or consortium members. Each UID will contain risk scores, reputation levels, and device and behavioral intelligence for complete and real-time risk analysis.
  • Consortium members can access UID information and associated risk profiles via an API, ingest data into their own risk models, and share feedback over time for continuous improvement.

As a membership-based consortium and shared database, SardineX welcomes broad industry participation.

The consortium will be “structured as an independent organization with a privacy-oriented data-sharing framework.”

Consortium members will “own the cumulative data, and members will set up mutually agreed-upon operating rules and data governance to determine when and how the data will be used. Sardine will be an equal partner to any other consortium member.”

Membership in the utility is “predicated on participants being permissioned parties that can access appropriate data under existing legal frameworks, including the Gramm-Leach-Bliley Act and Section 314(b) of the USA PATRIOT Act, to prevent fraud and money laundering.”

As noted in the update, Sardine is “an all-in-one fraud detection, compliance, and risk management platform.”

An experienced team with deep banking and fraud prevention experience enabling the company “to build innovative compliance and risk management services for financial institutions.”

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