Risk, fraud and identity protection

What’s happening in the credit union market? Everything, when it comes to ID theft and consumer monitoring. Bad actors across the globe strive to take advantage of every gap in procedures and real-world emergencies to harm your members. 

We, in the credit union movement, are all impacted by the negative effects of fraud. The individual member, credit union and association all pay part of the cost of the belligerent actors. What we saw in the last full year of available data, 2019, shows us over $3 billion in out-of-pocket costs and almost $17 billion in losses. These staggering numbers mean this subject is at the top of your members’ minds with more than four out of every five Americans concerned about fraud.

Your members are worried and are looking to their credit unions for guidance. Almost seven out of ten consumers state they are more likely to stay with their financial institution if protection is offered. More than half of those interviewed express a willingness to pay for a service. 

The fraud and account takeover problem is real, growing, and serious, with more than 13 million identity theft victims in 2019 alone. So, what is the ounce of prevention to negate the need for a pound of cure? Simply put, it’s leveraging data and technology in a comprehensive Identity Protection Service.  

There are two key aspects for credit unions to consider when determining a solution to prevent, detect, and resolve identity fraud; understanding the technology & data in use and determining what solution set can be offered as a member benefit versus a paid service.

First, let’s look at technology and data. When you are engaging with current or potential partners, ask about the following: 

Monitoring – What type of monitoring solutions are in place and do they include dark web monitoring?

Alerts – How does their monitoring system work and what triggers an alert to the member? Do their alerts only trigger for credit activity, or do their alerts include DDA events as well?

Resolution Support Team – When a negative event occurs, does the partner have a resolution team in place with the proper training? This should include anything from an attempted account takeover to a lost/stolen event.

An important note, your solution above should always be on, 24/7/365. 

There is a fairly standard structuring of member offerings in the credit union industry. A free-to-the-member basic solution and a premium option(s). 

As an example, the basic service often includes lost & stolen assistance, insurance, and fraud resolution. It’s a solid member benefit that is almost industry standard at this point. 

The premium option(s) offer a wide variety of services, which require some depth of analysis. A lot of the additional services you choose to offer at a premium or include in a basic benefit package should be determined by your member profile. Although everyone is a target and, therefore, everyone needs basic protection, not everyone needs $1 million in insurance or child SSN monitoring.

While it is impossible to adequately relay both the need and technological complexity of a properly applied credit monitoring and ID theft solution, now is the time to review, adjust, and train before the next data breach costs you and your members time, money, and reputation.