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10 Tips for Community Banks to Fight Fraud this Holiday Season

Nov 05, 2019
Dina Mickens, Vice President of Card Risk
Holiday 2019

While the season of cheer, joy, and family and friends are only a few weeks away, big spending and gift giving brings opportunities for fraudsters to spoil the holidays. Although there are some scams that are designed specifically for the holiday season, the truth is, most scams perpetrated during this time tend to be garden-variety fraud schemes that focus on online shopping.

As fraudsters ramp up their efforts this fourth quarter, follow these practical tips from Rippleshot Technology to protect your bank and its customers.

  1. Educate your cardholders. Encourage cardholders to regularly check their card statements and to create alerts tipping them off if purchases are made outside of their typical shopping patterns. Share trending fraud schemes and scams.
  2. Get more data. The faster you can obtain transactional data, the faster your data analytics team can determine the urgency of reissuing cards and minimizing cardholder disturbance. Monitor card performance continuously.
  3. Set up fraud metrics. Create a spreadsheet to identify compromised cards and cross reference against known breaches. Use these metrics to set your re-issuance strategy.
  4. Monitor fraud in real-time. Conduct daily and weekly monitoring and reporting of fraud to detect compromised cards. Your goal should be to obtain more information more frequently.
  5. Rely on better alerts. By the time a CAMS alert is issued, fraud has already occurred. Rely on software that focuses on smaller local breaches instead of just CAMS alerts.
  6. Demand more from your processors. Request that your processor provide you with better compromised point of purchase (CPP) information than CAMS alerts. Your bank can improve the odds of detecting skimmers with more alert sources.
  7. Re-issue smarter. Only 1-5 percent of compromised cards ever actually go fraudulent. Re-issue only the cards affected by three or more breaches.
  8. Monitor your ATMs. Educate employees to check your ATMs often. Have a response plan if there is a case that an ATM skimmer is found. Reset PINs rather than reissue cards and respond faster to skimming threats.
  9. Respond to breaches faster. Compromised cards must be identified within 24-48 hours to stop the spread of fraud.
  10. Invest in automation. Friendly fraud and synthetic fraud are rising. Invest in automation tools and rely on data analytics-based technologies to strengthen front-end review and fraud prevention.