To Catch a Fraudster: FBI Stops Criminals with Tips from CO-OP Shared Branching Credit Unions

To Catch a Fraudster: FBI Stops Criminals with Tips from CO-OP Shared Branching Credit Unions

To Catch a Fraudster: FBI Stops Criminals with Tips from CO-OP Shared Branching Credit Unions

This article previously appeared on CUInsight.

Criminals are at their best when victims are unaware. Financial crooks, especially, are most handsomely enriched when they can pull off their cons quickly, before their marks get wise.

Aside from speed, payment fraudsters – from check-kiters to identity thieves – also pay close attention to geography. In some cases, it makes sense for them to stay close to the victimized individual or organization to evade fraud prevention efforts triggered by zip code. In other situations, crooks must jump from city to city, or state to state, to keep ahead of local law enforcement. For this reason, it’s more important than ever for credit unions to be a part of a national fraud prevention network like CO-OP Shared Branch.

Here are three recent incidents that highlight what happens with credit unions across the nation work together to advance fraud detection and prevention.

Fraud Ring Accomplice Stopped by Illinois Teller

For three months in the early part of this year, one particularly nasty perpetrator was committing identity fraud in credit union branches in several different states, including New York, Pennsylvania, Indiana, Illinois, Texas and Florida. CO-OP, acting in collaboration with several different law enforcement agencies and credit union organizations, ultimately got her off the streets and out of the movement’s branches.

As the crook, who is believed to be part of a larger identity theft ring, made her moves, CO-OP engaged a syndicate of state networks and credit unions to gather security images and additional information on each fraud incident. After all the details were compiled, a fraud alert was distributed across the entire CO-OP Shared Branch network, reaching 1,800 credit unions and their frontline staff.

Shortly thereafter, a credit union teller in Illinois recognized the woman as she entered the branch. The teller contacted police, and the thief was arrested. CO-OP continued to support law enforcement post-arrest by working with the U.S. Secret Service to assist with the suspect’s interrogation.

25 Driver’s Licenses and 60 Fake Checks Found on Suspect

More recently, a thief in Virginia had been purchasing merchandize with counterfeit checks issued by a credit union. Thanks to the fast-acting of credit unions in the CO-OP Shared Branch network, the impacted state’s credit union league and the FBI, the perpetrator was captured before he could do more damage.

When arrested, he was in possession of 50 credit union- and bank-issued checkbooks, 60 loose checks and more than 25 driver’s licenses all with the same name. According to the arresting officer, the suspect had reported his driver’s license lost multiple times. Each time, he successfully secured a new card with a new driver’s license number. Armed with this collection of fake IDs, he had the opportunity to continue his spree for many months had he not been stopped.

Georgia ID Used to Steal from Colorado Member in North Carolina

Just last month, a Colorado credit union member noticed unusual withdrawals from her account. The transactions had occurred in North Carolina. The perpetrator had used a counterfeit Georgia driver’s license to request cash withdrawals at three different credit union branches within the same local area. CO-OP quickly alerted the state league and published a fraud alert, including an image of the suspect. Thanks to the notification, credit union staff in North Carolina recognized and denied the crook’s request when she visited their branch. Days later a second credit union’s staff member, who also recognized the perpetrator from the alerts, called the authorities who ultimately arrested the suspect.

Credit Unions Link Together to Fight Fraud

As these incidents demonstrate, collaboration is critical to thwarting the fast-moving, far-reaching payment crimes of today. When part of a network like CO-OP Shared Branch, credit unions can quickly communicate fraud trends, incidents, tips and tricks. Collaboration with law enforcement is also easier when credit unions are connected and working together to fight fraud.

Just as credit unions share information with law enforcement, agencies like the U.S. Secret Service regularly share crime intel with credit unions via CO-OP’s fraud team. For example, the agency recently shared detailed instructions, authored by a convicted and incarcerated identity thief, on how to create a credit union member profile. The instructions had been scrolled on a writing pad discovered in a prison cell. Armed with real-time information like this, the movement’s ability to not only spot, but predict, payment fraud scams is immediately enhanced.

The Complete Picture

Stopping all fraud is a lofty goal, but one credit unions and CO-OP’s fraud team pursues none-the-less. The combination of human talent with advanced technology like machine learning is creating a very unfriendly environment for even the savviest of fraudsters. Relentless, creative and tenacious, collective fraud teams across the network have contributed to a fraud loss rate of .003 percent from January to June of this year. Ongoing collaboration between law enforcement, credit union networks, state leagues and other credit union organizations is proving to be an effective defense against fraud.