Older isn’t always wiser. Though we’ve all been fighting fraud for years, it seems many of us are getting worse – not better – at it. According to a report by Aite Group, consumers are engaging in risky behavior, even when they know they should not. Among the risky behaviors on the rise:
- 20% left their smartphone unlocked when not using it (11% in 2014).
- 18% threw papers with account numbers in the trash without shredding them (13% in 2014).
- 14% used online banking or shopped the internet without security software or on a public computer (7% in 2014).
- 9% made a note of their PIN and kept it with their card (6% in 2014).
- 8% responded to emails or calls asking for banking details (5% in 2014).
What’s going on? It could be that fraud seems beyond our control: If the U.S. Government, the nation’s health insurers and hospitals, large and small retailers and even celebrity selfies are not safe from hackers, what’s the point of taking precautionary measures?
It could be that people are confused. Do tried-and-true security practices still apply today? Almost certainly, people are tired. Faced with yet another stack of sensitive documents, even the strong among us might think, “I just can’t.”
Yet, card issuers can’t simply overlook the risk in risky behavior. Globally speaking, Aite found that nearly half (47 percent) of American cardholders have experienced card fraud in the past five years – and 17 percent have experienced it multiple times. Fraud doesn’t decrease as interest in security flags. On the contrary, risky behavior opens the door to fraud.
Beyond this, fraud triggers a delicate balancing act for card issuers. “This study confirms that card fraud remains an issue of deep concern for consumers around the globe,” says Andreas Suma, vice president and global lead, fraud and data, ACI Worldwide. “It’s no surprise that there is a direct correlation between fraud and lower consumer trust and card loyalty, including a primary contributor toward ‘back of wallet’ behavior. And as this data illustrates, it’s more critical than ever for financial institutions to implement and actively maintain effective fraud prevention solutions that address fraud, security and customer experience needs.”
That’s easy to say, but not as easy to do. When reaching out to jaded members, the burden is on you to provide timely, accurate, usable information:
- Be smart about member education. Ask yourself how you can update members on the latest security risks and best practices. Consider posting short, informal videos alerting members with tips and tactics.
- Help members engage meaningfully in their own security. Members might be charged up about mobile security if they could use their phones to combat fraud. Tools like controls and alerts transform mobile devices from targets of fraud to fraud-fighting weapons.
- Let members know what you’re doing to keep them secure. If you have the best fraud detection in the business, your members should know this.
- Enhance security whenever you can, but don’t be onerous about it. Aite reports that security measures that are too heavy-handed have the opposite effect on consumers. Example we’ve all experienced: When password requirements and security questions are too difficult, they become unusable.
Get the latest buzz on fraud! Join CO-OP’s fraud specialist John Buzzard for a series of free monthly webinars designed to give credit unions and industry experts an opportunity to share and collaborate around security. The next Fraud Buzz webinar airs live October 20, 2016, at 11:00 a.m. PT (2:00 p.m. ET). Register Now
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