Credit unions have recently experienced a period of significant growth. But this also means increased risk. As some larger banks continue to receive negative press, credit unions have an opportunity to capture more members who are looking for alternatives to the big bank experience – but along with new members come fraudsters.
Two of the most significant fraud challenges facing credit unions today are the rise of synthetic identity fraud at account opening and the resurgence of account takeover fraud. Both of these scenarios pose technology, resourcing and friction challenges.
Credit unions are experiencing a greater volume of fraud attacks at account opening than ever before. With valid personally identifiable information readily available from data breaches and digital attacks, application fraud techniques are becoming more sophisticated and widespread. This puts credit unions in a precarious position. They must do all they can to identify fraud during new account opening, while being mindful that overly aggressive or inefficient fraud detection strategies may also present a risk to their organization.