By Robert Jarosinski
With the holiday season around the corner, fraudsters are ready to attack. They know transaction volumes are significantly higher this time of year, so it's harder for victims to detect fraud. They also see new opportunities as consumers now make more online and mobile purchases than ever before.
So, rather than focusing solely on plastic cards this year, they’re moving to other means for stealing consumer data. This includes retail website databases, social media sites and more. And, once they secure key personal information, they can use it to take over accounts and spend hard-earned dollars that don't belong to them.
With unsuspecting members letting their guard down for holiday shopping, fraudsters may strike in any number of ways. Credit unions can protect themselves through the giving season by following a few tips:
2. Ensure that your member service center is on guard for fraudsters impersonating members. Implement strong authentication protocols and consider adding technology to score member interactions for risk if you don't already use it.
3. Review suspicious activity and confirmed cases of fraud in as close to real-time as possible.
4. Create fraud management rules to monitor and counter exhibited patterns of fraud. In particular, monitor for 3-D secure transactions (verified by Visa and MasterCard SecureCode). Credit unions have reported increases in fraud from this channel with no liability shift opportunity.
5. Validate CVV2 / CVC2 and Address Verification Services are used to ensure chargeback rights are preserved in a Card-Not-Present environment. This is especially timely because some reports suggest that nearly 50 percent of holiday shopping will involve online transactions.
6. Provide members with the ability to receive account alerts and promote its usage.
7. Stay on alert for “friendly” fraud perpetrated by members. Consider consequences that follow the law to help minimize and deter this kind of chargeback behavior. Maintain a positive member experience by scripting good questions for members and developing prepared answers to common objections.
Unfortunately, holiday fraud risks exist outside of credit union control. Credit unions and members working together is the best bet for mitigating risks. Check back soon for tips your members can use to protect themselves against holiday fraud.
To obtain access to:
Protection Resource Center – Visit My Services at cunamutual.com. A RISK Alert subscription is included with your access.
RISK Alerts – Visit Edit Subscriptions. Select Credit Union Protection from the center menu and check the box for RISK Alerts.
