Trusted News for Credit Union Leaders
Credit Union Times
JANUARY 10, 2018 | VOL. 29 | NO. 1 | CUTIMES.COM
wave of counterfeit checks has been taking aim at credit unions, and credit unions that
aren’t on the lookout could end
up footing the bill.
According to a risk alert from
the Carmel, Ind.-based Allied So-
lutions, criminals have been send-
ing consumers “official checks”
that are fraudulently written out of
credit union operating accounts.
Consumers unwittingly deposit
the checks at their local financial
institutions, and once everyone
eventually realizes the checks are
fake, it’s often too late — consum-
ers and sometimes even credit
unions are left holding the bag.
Mailing counterfeit checks to
consumers isn’t that new — in
fact, the NCUA issued a fake check
scam warning back in April. But
the frequency of the crime has
become an issue lately, accord-
ing to Ann David-
son, who is the vice
president of risk
consulting at Allied
Solutions.
“I’ve seen this
over the years, this
has been going
on. But it’s really
picked up quite a bit,” she said.
How it Happens
According to the alert and to Davidson, the fraudsters tar-
CYBERSECURITY
NAIC Approves Model Law
On Oct. 24, the National Association of Insurance Commissioners formally approved the Insurance Data Security Model Law.
The NAIC is a standard setting and regulatory support organization consisting of the top
insurance regulators from the 50
states, District of Columbia and
five U.S. territories.
The model law applies to “
licensees,” which are defined as
persons and nongovernmental business entities subject to
the insurance laws of the state
adopting the model law.
In Pennsylvania, for example,
this would encompass insurance
companies and insurance producers (i.e., agents, agencies and
brokers). Notably, this applies to
nonresident licensees except for
purchasing groups, risk retention groups or when acting as assuming insurer.
For example, a financial expert
in a state that has not adopted the
model law, is potentially subject
to the model law if they are also
licensed in another state that has
adopted the model law. Thus, it
will be important to track what
states enact the model law and
also how uniformly the model
law is enacted state to state.
Standards
The intent of the model law is to
establish standards for data security, the investigation of cybersecurity events and notification
of the commissioner of cybersecurity events. In order to Y17
Must Reads
2018 Tech
Expectations
ROY URRICO
rurrico@cutimes.com
t will be an exciting 2018 for
credit unions if just a percentage of the industry forecasts
listed prove foretelling. However, expect continued cybersecurity incidents and threats to steal
some attention.
The following are capsulations
of some pertinent 2018 insights,
expectations and predictions offered by financial services industry
companies and experts on a range
of topics such as digital, mobile
and retail banking; payments and
cryptocurrency; data security; application programming interfaces;
fraud; the Internet of Things; core
deposits; credit union bank acquisitions; machine learning and artificial intelligence.
Mike Morris, systems part-
ner, Porter Keadle Moore:
• Data security and risk management remain a hot topic. Regulators increase their review and
oversight.
• Credit unions will need to place
greater focus on risk management programs to ensure they
hold up to this amplified scrutiny, particularly as it relates to
vendor management.
• Financial institutions will begin
to explore blockchain’s potential
to create secure transactions at
lower costs.
Robb Gaynor, co-found-
TECHNOLOGY
Y18Y16
CUs Still Fighting Check Fraud
TINA OREM
torem@cutimes.com
MANAGEMENT
Davidson
Synthetic Fraud
Alert
Protect your CU
from fake identity
tricks. Y13
The Branch
Experience
Make in-person
service excep-
tional. Y10
FOCUSREPORT:
YEAR IN
PREVIEW
The potential enactment of a regulatory relief bill remains top of
mind for credit union executives and trade organizations going into
2018. In this Year in Preview issue, learn the details of the regulatory
overhaul legislation that’s currently on the table and what it means
for the industry. Y8
