Western Independent Banker - January/February 2008 - (Page 31) By Anne K. Scully, WIB Service Corporation President of consumer confidence, remediation expense and reputation loss. The WIB Service Corporation can’t protect your bank from fraud. However, we can help you withstand the potential onslaught of fraudulent bank card activity through a new insurance product offered through WIB-endorsed VIP Independent Bankers Insurance Services (IBIS): The Bank Card Protector (BCP) Policy. T he BCP Pol ic y prov ide s t h re e valuable coverages: • E l e c t r o n i c Te r m i n a l F r a u d — Your ba nk is covered against a ny lo s s re su lt i ng d i re c t ly f rom t he unauthorized use of a bank card at an electronic terminal — ATM, POS and Cash Dispensing Machine. • Telephone, Mail Order and Internet Sales Fraud — Your bank is covered against any loss resulting directly f rom t he u naut hor i z e d u s e of a ba n k ca rd in a telephone or FA X t ra nsac t ion, reg u la r ma i l (USPS) transaction or Internet transaction when approved or Verified by Visa or Master Card SecureCode (e.g., “card not present” transactions). • Compromised Cards Extra Expense — Your bank is reimbursed for the extra/direct costs to reissue cards that were reported compromised at a third party location by Visa or Master Card. • Sk i mmi ng /Phishi ng / Hack i ng / ID Theft — Your bank is covered from losses from: • Skimming — theft of card information by copying account information; • Phishing — theft of account information when the attacker sends an email purporting to be from a valid f inancial or eCommerce provider; • Hacking — theft of card information from a merchant database or merchant processor; and, • Identity Theft — when card information is used as a result of Identity Theft. Western Independent Banker Other Advantages of the BCP Policy: • Worldwide Coverage: The BCP Policy covers losses on fraudulent transactions that occur outside of the United States and Canada. This is important because fraudsters don’t confine themselves to geographic boundaries — nor should your coverage! • Reasonable Premium Costs: The typical annual premium range is approximately $180 per $1,000,000 of annual card transactions. • Low Deductibles: The per card deductible is only $1,500. • No Adverse Experience on a bank ’s financial institution bond. • Program underwritten by AIG (A+ rated). What kind of fraud losses have been covered? • A community bank had a customer’s card skimmed while on vacation and used in Brazil. More than $12,000 was taken out of the account before the customer returned to discover the loss. The bank used a neural fraud detection system and read their foreign transaction report but had been notified by the customer that he was out of the country on vacation. • A community bank in the west had a customer living in an assistant living facility. The customer’s card was stolen along with the PIN by an employee of the facility. The thief took approximately $9,000 from the account. Since most of the transactions were PIN-based, the neural fraud system didn’t respond early enough to shut down the card. • A data breach at a restaurant caused a community bank to have over 20 cards breached causing a total loss of over $38,000 before a CAMs report was ever released. Most of the fraudulent transactions were made in Mexico. For further information, contact: Pat Corey, IBIS, 480-663-3778 or pcorey@ ibisinsurance.com. IBIS is a WIB-endorsed Value & Income Program Partner (VIP). WIB-endorsed VIPs • ATM Network and Driving/Debit Card Processing First Data Debit Services/STAR Network • Bank Operations Profitability Consulting Profit Performance Group • Check Overdraft Privilege Pinnacle Financial Strategies • Check Printing Harland Clarke American Checks • Commercial Equipment Leasing BancLeasing • Competitive Market Intelligence Market Rates Insight • Credit Risk Management and Stress Testing Inmatrix • Executive & Board Compensation Analysis Equilar Inc. • Insurance for Community Banks Independent Bankers Insurance Services • Insured Deposits/Funding for Community Banks The Reserve • Internet and Network Security Services SecureWorks • Loan Portfolio Tracking/Insurance for Lenders and Customers Kesler Associates • On- and Off-Balance Sheet Sweep Accounts The Reserve • Surcharge-free ATM Network MoneyPass • Workers’ Compensation SelfInsurance Group for California Banks WIBSIG January/February 2008 31
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