Jim Van Dyke
Jim Van Dyke, Sontiq Corp.

‘Deputize’ members in fraud fight

Combine security advice with your financial wellness tools and information.

September 21, 2021

Fraud protection is the most important factor when consumers select a payment card, surpassing customer service, rewards, interest rates, and other factors, according to Javelin Strategy & Research.

But few financial institutions provide clear and comprehensive information about how consumers can guard against fraud, says Jim Van Dyke, senior vice president of innovation for Sontiq Corp.

He addressed the 2021 CUNA Operations & Member Experience Council and CUNA Technology Council Virtual Conference on Monday.

“It shouldn’t be a mystery for members about how to protect themselves,” says Van Dyke, who reports that scam attempts have grown 3,000% during the pandemic. “Many communications about breaches are confusing. The education we’re giving consumers is garbage, so it goes in the garbage.”

The way forward is to “deputize” members in the fight against fraud by educating and engaging them against misuse of their own data, he says. This, in turn, will protect your credit union.

Van Dyke advises credit unions to:

  • Provide features that make members feel secure, including guaranteed reimbursement for fraudulent transactions, real-time alerts for sensitive transactions, and information about how to avoid fraud.

    “Position this as a partnership,” Van Dyke says. “Advise members to join you. People are excited about these capabilities.”

  • Proportion your empowerment efforts. Focus 60% of security efforts on prevention, 30% on detection, and 10% on restoration.
  • Combine security advice with your financial wellness tools and information.
  • Talk about breaches in your local area and their potential effect on members, including specific risks and action steps. “National breaches get the headlines, but they’re probably less dangerous to your members,” Van Dyke says.
  • Treat members as individuals. They have different data breach histories and they need different types of help.
  • Encourage members to discontinue paper statements.

  • Educate select employee groups about fraud scams.
  • Provide online banking safety tools, including two-factor authentication, alerts, account monitoring, and card controls.

“There’s no way forward but to work with members,” Van Dyke says.

This article is part of Tech21, CUNA News’ special focus on innovations and developments in technology. Search for the hashtag #Tech21 to follow the conversation on Twitter.