The NAFCU Journal March-April 2020 - 18

You don't have to pick up the yellow
pages and call the FBI. You don't have to
start at square one."
Networking with other financial institutions, being involved in NAFCU
and reading emails from cybersecurity
groups also help keep credit unions
informed about new tools, products and
services meant to keep pace with the
ever-churning minds of fraudsters.

that.' I tell them not to rely on decisions
I have made in order for them to make
decisions regarding this member."
Employee training should offer a clear
understanding of why controls are in
place and need to be followed. "Everybody wants to be helpful. We've all done
it," Hernandez says. "These bad actors
take advantage of it."

THE BOTTOM LINE

Closing the door to fraud is the first
and best line of defense. Without the
right parameters and layers of risk
prevention tools in place, Davidson
says, credit unions with self-retention
provisions in their insurance policies
could absorb huge losses. Plus, insurance
policies might not cover every instance
of fraud.
Credit union executives must read
insurance policies from top to bottom
before signing, says Jackson. Her CEO
reads all insurance policies and convenes
her team to scrutinize the contents and
their match with credit union policies
and procedures.

Vendor management is another important
plank in fraud detection and prevention.
At RBFCU, products are reviewed regularly
for performance, and vendors are "kind
of on notice" to share their latest and best
products, Santos says. "We want those
vendors walking hand in hand with us."
Although fraud may be on the agenda,
the questions boil down to managing
risk. "What are we willing to take on,
what are we not willing to take on, and
18

what tools and solutions are out there to
help us manage?" Davidson says.

LAW ENFORCEMENT
AND NETWORKING

Credit union officials agree: Strong, twoway relationships with law enforcement
are crucial in the battle against fraud.
Through open communication and joint
training, credit unions have partners who
can investigate fraud and alert them to
emerging schemes.
With branches on U.S. government
property, Century Federal has learned that
visible relationships with law enforcement
can be a deterrent to would-be fraud
perpetrators. There, officers can respond
to calls within 20 seconds, and the credit
union makes a point of having the officers
come by even without emergencies at hand.
"Outside actors do see us having that relationship with law enforcement," Jackson
says. "I do believe that has actually made
a difference."

"You sit here and think we're all alone,"
Santos says. "In the big picture, you
reach out to everybody else, and they say,
'We see this every day.' "

PROTECTING YOUR REPUTATION

When it comes to fraud against
credit unions, reputational risk and
the risk of financial losses run hand
in hand, Santos says. "If your reputation
is damaged, people aren't going
to want to become members, or
they'll be a bit reluctant to apply for
products and services."
How a credit union balances security
with member convenience is different for
each one. "What makes a credit union's
personality is the services they offer the
members, and the services they're offering
are going to dictate the controls they have
and how they service customers," Hernandez says. "That's a big part of knowing
their customer footprint and understanding their customer interaction."

RBFCU belongs to intelligence groups
and casts law enforcement relations in a
big-picture light, encompassing federal,
state and local officials.

Compared to larger financial institutions,
credit unions have two powerful weapons in the fight against fraud - personal
interaction and relationships with members. When something seems wrong, "we
have the time to find out and take the
next steps, if necessary," Jackson says.

"We cooperate to the fullest extent of
whatever we can," Santos says. "Sometimes, our hands are tied. We may need
a subpoena or court order. We want to
make that crystal clear and tell them
exactly how to do that."

"We know that member, and we're not
overstepping our boundaries if we want
to protect them," she says. "It may never
go any further, but we can say we did
our part. If you're protecting your credit
union, you're protecting your members."

Established contact, he says, creates a
professional relationship with mutual
understanding. "You're seen as a partner.

M. Diane McCormick is a freelance
journalist and a frequent contributor
to The NAFCU Journal.
THE NAFCU JOURNAL MARCH-APRIL 2020



The NAFCU Journal March-April 2020

Table of Contents for the Digital Edition of The NAFCU Journal March-April 2020

The NAFCU Journal March-April 2020 - Cover1
The NAFCU Journal March-April 2020 - Cover2
The NAFCU Journal March-April 2020 - 1
The NAFCU Journal March-April 2020 - 2
The NAFCU Journal March-April 2020 - 3
The NAFCU Journal March-April 2020 - 4
The NAFCU Journal March-April 2020 - 5
The NAFCU Journal March-April 2020 - 6
The NAFCU Journal March-April 2020 - 7
The NAFCU Journal March-April 2020 - 8
The NAFCU Journal March-April 2020 - 9
The NAFCU Journal March-April 2020 - 10
The NAFCU Journal March-April 2020 - 11
The NAFCU Journal March-April 2020 - 12
The NAFCU Journal March-April 2020 - 13
The NAFCU Journal March-April 2020 - 14
The NAFCU Journal March-April 2020 - 15
The NAFCU Journal March-April 2020 - 16
The NAFCU Journal March-April 2020 - 17
The NAFCU Journal March-April 2020 - 18
The NAFCU Journal March-April 2020 - 19
The NAFCU Journal March-April 2020 - 20
The NAFCU Journal March-April 2020 - 21
The NAFCU Journal March-April 2020 - 22
The NAFCU Journal March-April 2020 - 23
The NAFCU Journal March-April 2020 - 24
The NAFCU Journal March-April 2020 - 25
The NAFCU Journal March-April 2020 - 26
The NAFCU Journal March-April 2020 - 27
The NAFCU Journal March-April 2020 - 28
The NAFCU Journal March-April 2020 - 29
The NAFCU Journal March-April 2020 - 30
The NAFCU Journal March-April 2020 - 31
The NAFCU Journal March-April 2020 - 32
The NAFCU Journal March-April 2020 - 33
The NAFCU Journal March-April 2020 - 34
The NAFCU Journal March-April 2020 - 35
The NAFCU Journal March-April 2020 - 36
The NAFCU Journal March-April 2020 - 37
The NAFCU Journal March-April 2020 - 38
The NAFCU Journal March-April 2020 - 39
The NAFCU Journal March-April 2020 - 40
The NAFCU Journal March-April 2020 - Cover3
The NAFCU Journal March-April 2020 - Cover4
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