Letters from Leadership | April 4, 2007

Debit card fraud prevention and recovery

This past February, we were informed VISA® Check Cards (also known as debit cards) used by several hundred UFCU members, along with those belonging to patrons of other credit unions and banks, may have been compromised in a security breach at a local merchant. UFCU immediately contacted each affected member by phone and, in some cases, by mail to alert them of the situation and to inform them we had deactivated their debit cards to prevent unauthorized charges to their respective accounts. That evening, two UFCU branches remained open late to permit affected members to immediately replace their potentially compromised cards.

PIN-based transactions

Criminals may perpetrate debit card fraud by placing a card skimming device on point-of-sale terminals that captures Debit Card magnetic stripe data and each associated four-digit PIN number. Using the captured data, criminals then manufacture fraudulent Debit Cards subsequently utilized at ATMs to steal money from individual’s accounts.

Preventing debit card fraud

Most members benefit enormously from the convenience of using Debit Cards rather than writing checks or carrying large amounts of cash. By following these guidelines, you can avoid this and similar Debit Card fraud schemes:

  1. First and foremost, when making a debit card purchase at a merchant for groceries, gas, or other consumer goods, select the Credit option instead of the Debit option, thereby avoiding use of your PIN. To do this, you may need to SLOW DOWN because point-of-sale terminals vary and may require different responses. Some terminals simply offer you a choice of Debit or Credit as part of your transaction. Others require you to Cancel the Debit Card transaction in order to be given a Credit option. Still other terminals require some action from the sales clerk. Remember: The best way to prevent debit card fraud at the point-of-sale is to avoid using your PIN by selecting the Credit option. You control whether or not your debit card transaction is processed as a PIN-based Debit or as a Credit transaction. If need be, ask the sales clerk for assistance.
  2. Use UFCU’s Online Banking service to review the transaction history on your account frequently, if not daily. Report any suspicious transactions immediately to UFCU Member Services.
  3. Set up the Account Alerts feature within UFCU’s Online Banking to automatically notify you by email anytime a transaction over your predetermined amount clears your account. For example, you may wish to be notified by email whenever a transaction greater than $100 clears your checking account. This service is easy to initiate and is provided to you by UFCU at no cost. Simply login to Online Banking and select Account Alerts to set up this feature.

Making ATM withdrawals

You will need to continue to use your PIN to withdraw cash at ATMs. National ATM networks require all member banks and credit unions use fraud prevention technology that encrypts your PIN as soon as you enter it into the keypad, making ATMs a secure environment. Of course, always be mindful of your personal safety. Avoid ATMs in dark, secluded environments. Avoid any ATM or point-of-sale device that appears broken or that shows signs of having been altered. Trust your instincts. If something looks unusual, report it to the ATM owner and use a machine with which you are comfortable.

We know UFCU members appreciate the convenience afforded by electronic banking services, so we continuously strive to maintain the integrity and security of electronic delivery channels. As always, thank you for your membership and business!

Warmest regards,

Tony C. Budet