FAIRLAWN, Ohio (7/24/13)--At least half a dozen members of Towpath CU, a $115 million asset credit union in Fairlawn, Ohio, experienced fraudulent transactions originating in China on their accounts last week.
Towpath warned that six and possibly eight members saw transactions averaging $800 from a merchant--believed to be a bar--in Shanghai, the credit union told the Beacon Journal (July 19).
Members began reporting the transactions Thursday afternoon, and the credit union has been reviewing its accounts for other potential victims, said the newspaper. Towpath is replacing the cards and returning the money stolen from the accounts to the member when they sign an affidavit about the loss,
Towpath's website said it has shut down its Towpath CU Debit and Visa cards in China to avoid more potential fraud. No other areas have been impacted. The site provided telephone numbers for the credit union and for Visa to report suspected fraudulent activity.
Towpath CEO Rose Bartolomucci told the newspaper that the national company that handles debit cards for financial institutions including Towpath sent an alert in June about similar fraud originating in China.
The newspaper said the scam is unusual because the scammers swiped actual debit cards with the member's account number on them to complete the bogus transaction. When an actual card is swiped, the financial institution can't charge back the funds to the merchant as it could if only a stolen account number had been used for the transaction.
The credit union urged consumers to monitor their transactions and immediately notify their financial institution if they suspect fraudulent activity.