When developing our newest online membership enrollment product about two years ago, we needed to cross the learning curve on electronic identity verification (IDV). Since that initial implementation, IDV has proven to be an effective online tool with many opportunities to help credit unions mitigate fraud risk. Explained below are three creative ways to use IDV in your credit union for risk mitigation:
Use 1 – Creating New Memberships
When serving members online, how do you really know that they are who they say they are? Incorporating electronic ID verification tools at your credit union can drastically help your staff verify the identity of credit union members when working with them via the web.
Information electronically captured through the new member enrollment application can be used to verify identity. Based on this information, electronic ID verification can pose questions to online users, which are then used to verify that the applicants are who they say they are.
First, verifying the application data being submitted – such as name, address, Social Security number, date of birth, home phone number – ensures the member data is accurate and belongs together. Upon successful verification of this data, an ID verification tool formulates “out-of-wallet” questions based upon public record data. Your credit union should be able select the types of questions being asked, the number of questions required to pass or fail, and even decide whether to throw in a few “red herring” questions to trip up fake applicants.
The premise behind this security precaution is that if a member has his or her wallet or purse stolen, a thief can easily perpetrate identity theft as a result of having personal information from that wallet or purse. Questions posed to verify ID are based on the member's background and are not related to ID's or credit information, making it much harder for a thief posing as a member to answer questions on a person's background.
Use 2 - High Risk Transactions
One of our clients recently came up with a second – and creative - way to use IDV as an added security check to “front end” high risk transactions.
Electronic ID verification can be an ideal part of the normal processing for these transactions – such as wire transfer requests – and also meet some of the objectives imposed by the Federal Financial Institutions Examination Council’s (FFIEC) Guidance on Authentication in Internet Banking Environment beginning this year.
The wire transfer processes begins when a member submits a wire request. If conducted online, they are asked identity verification questions for additional security. If submitted by fax or mail – staff can contact the member independently to walk through identity verification questions. Either way – the use of IDV ends up protecting both the member and your credit union from a potentially fraudulent request.
Use 3 - Do you have another form of ID?
Suppose a member calls and asks for account information – but it doesn’t quite sound legit. Or a member walks into a branch and reports that her purse was stolen – along with all her cards and identity. Unless you personally know someone, how do you really know who you are speaking with?
IDV is a handy add-on for branch and contact center personnel to have an extra identification tool to quell any security threats in these circumstances.
Want to learn more? Try it.
fiVISION has incorporated IDV into many aspects of the memberWORKS Relationship Management system in the several ways suggested above. Such ID verification tools aid your credit union in verifying the identity of online – and in-person – users alike. Click here if you would like to try IDV and learn more about how it works with our memberWORKS Relationship Management System.
fiVISION’s CRM and account opening products currently interfaces with Symitar Episys™, Open Solutions Inc.’s RDS, and XP Systems’ XP2 data processing platforms and 10+ peripheral member data systems. For more information, contact fiVISION at 317.612.3350 or visit www.fivision.com.