Posted: Jan 6, 2017
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Author: Tom Davis

CSCU's Tom Davis self grades his 2016 predictions. What grades would you give him?

At the beginning of 2016, I made several predictions about what would be happening in payments and how they would impact credit unions. With 2016 now in the rear view mirror, it is time to take a look back at what happened in 2016 and grade my predictions – the original article can be found here.

Mobile wallets

My Prediction: “MasterCard Digital Enablement Service (MDES) and Visa Digital Enablement Program (VDEP) have streamlined credit unions’ enrollment in mobile wallets.  In 2016, we expect as more mobile wallets become available from smartphone makers such as LG and HTC, this process will become even more efficient” “

How I Did: ‘B’ I correctly called the role that MDES and VDEP had in enabling credit unions to enroll in the “Pays” – by the end of the year more than half are enrolled. But I missed the mark on LG and HTC releasing their pays.

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Posted: Dec 8, 2016
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Author: Paul Castner

Bold Move Pays Off Positively for the Jackson, Michigan-based Credit Union.

Wendy’s restaurants, long known for its “biggie size” servings, might now be better known as a frequent target of “biggie-sized” data breaches resulting in massive credit card fraud.  Since the fall of 2015, according to one industry source, 1,025 Wendy’s point-of-sale systems in the United States were infected with malware during a five-month-long period.   While Wendy’s said they removed the malware, data breaches continued to reoccur in a number of locations including Jackson, Michigan, the hometown of American 1, a leading credit union in the region that vigilantly monitors member accounts for suspicious activity. American 1 says that to date, they have reached approximately $600,000 in fraud (about 150,000 doubles with cheese!) related to the Wendy’s breach leading to a decision that the credit union never imagined that they would have to undertake. 

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Posted: Aug 24, 2016
Categories: Debit Cards, Fraud
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Thoughts on the Good News and Bad News for Credit Unions

When a debit card number is counterfeited, like what happens in a breach of data from a merchant, any counterfeit card number usage results in withdrawals directly from the cardholder’s bank account. Even though the cardholder’s liability for fraudulent transaction is limited - under the FCBA, liability for unauthorized use of the card tops out at $50 and many issuers have a $0 liability for fraud - there also can be additional costs and fees as a result. Checks that bounce result in NSF charges or scheduled bill pays that fail and incur late fees are just some of the aggravations that debit cardholders whose cards were caught in one of the many highly publicized data breaches had to deal with.

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Posted: Jul 22, 2016
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A follow up to previous TPR article on this topic

Fraud continues to be the number one reason why a cardholder moves a card from top of wallet. And fraud isn’t cheap, costing the issuer in liability for the fraudulent charges plus the cost of reissue.  Additionally, there is the potential of lost revenue from the card being moved from the number one position in the cardholder’s wallet.

A previous thought leadership article on introduced the concept of putting the cardholder in the middle of the transaction, meaning enlist the cardholder to take ownership of monitoring card purchases and respond quickly to potential fraud.

A shining example of success implementing this strategy took place over the 4th of July weekend. FIS, CSCU’s processing partner and international provider of financial services technology and outsourcing services, rolled out a new product, SecurLOCK Communicate.  The product alerts credit and debit cardholders of potential fraud in real time via a two-way interactive text message (SMS), or a voice call, or an email.

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Posted: Jul 12, 2016
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Author: Barney Moore

Chargebacks to merchants have become a hot topic of late. And for good reason. According to a recent report by First Annapolis Consulting, chargebacks for card-present transactions increased 50% following the October 1 EMV liability shift.  While this took merchants by surprise, it did not surprise issuers who, until the October 2015 liability shift for chip cards processed at card-present non-chip terminals, were absorbing the cost of fraud for counterfeit cards. Now issuers are allowed to chargeback, or pass back the fraud to the merchants who were not processing chip cards.

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