More U.S. consumers than ever are swiping and tapping to check their bank account balance, to transfer money or deposit a check. The result has been a mobile banking boom. To keep up with demand, banks and credit unions have been fast to develop their own apps and mobile-friendly services, including enhancing ATMs with the latest check deposit imaging capabilities.
A recent fraud and security alert from Allied Solutions highlighted an emerging brute-force attack occurring on FIs nationwide due to card BIN numbers being issued in sequential order. Cyber criminals have determined that cards issued in sequential order are an easy entry point for brute-force attacks where fraudsters can steal card payment data.
If you’re already using TrueChecks® to scan your mobile deposits automatically, then you’re in better shape than most FIs out there. In fact, according to the 2017 AFP Payments and Fraud Control Survey, 75% of organizations in 2016 experienced check fraud, and the mobile channel is a hot spot for this type of activity. Without a database like TrueChecks® to spot fraudulent remote deposits, they can be harder to catch than checks coming through the teller line.
Among all the things we train our customers on here at AFS, teaching them the tips and tricks of catching deposit fraud is one of the most important. Aside from just this fundamental training, though, there is a cultural element that can be encouraged at banks and credit unions that makes the ‘game’ of spotting fraudulent deposits fun and rewarding for staff. The trick is knowing how to position the benefits to encourage strong, consistent participation.
One of the most important factors in the continued success of the TrueChecks® software is the critical component of data contribution. Coming from thousands of banks, credit unions, and third-party entities nationwide, the TrueChecks® database is comprised of live check fraud data fed into the system day in and day out.
At AFS, we strive to not only help mitigate and prevent fraud losses at your institution with our fraud prevention software, but we also strive to educate and keep you up-to-date on important fraud trends. Technology continued to grow in 2018, which created more avenues for fraudsters to attack, and there is no limit to how far swindlers will go to steal information or money. Here is a breakdown of some of the fraud trends we saw in 2018.
Professional scammers are always trying to think of ways to swindle people out of their hard-earned money and often pose as charities to cover their bad intentions. Many of these scams are active throughout the year but are especially prevalent during the holiday season and the first part of the New Year when people are looking for last-minute donations for tax purposes.
Small businesses often find that credit unions offer products specific to their needs. Credit cards with low fees, competitive interest rates, and cash back offers make credit card transactions more appealing. Credit unions also have the advantage of a closer, more personalized banking relationship with their members.
While banks and credit unions continue to strive to become more agile, accessible, and user-friendly the additional channels now available to customers are opening FIs up to new security loopholes that let fraudsters in. Today, we address some of these new security challenges as they relate to deposit fraud and what your institution can do to close the gaps and secure these channels.
In 2016 there was $1.3 billion in debit card fraud as reported by the 2017 ABA Deposit Account Fraud Survey. That means debit card fraud accounted for 58% of all fraud types, across all channels, and in every kind of institution.
The Automated Clearing House (ACH) Network is used by a vast number of financial institutions to handle bill payments, cash transfers, and direct deposits. Virtually everyone has made an ACH transaction at some point, but unfortunately, a rising number of criminals have started using the Network to scam innocent individuals and take money directly out of their checking accounts.
Catching check fraud before it’s deposited is obviously the ideal scenario for banks and credit unions because it avoids the litigation and expense of prosecuting for fraud. However, when bad items do sneak through, there are some important things banks can do to fight back and prosecute repeat check fraud offenders.