Thursday, September 4, 2014

Endless Stream of Merchant Data Breach Cases - Card Changes

This week has delivered news of yet another large national merchant who has had customer card data stolen from them. Home Depot follows a long line of merchants who have clearly demonstrated the inability to protect card data being utilized in their establishments. At this point, financial institutions have very little faith in merchants protecting the data that they process. Huge fraud costs are being absorbed by the financial institutions because of these merchant data breach incidents. Litigation to recover losses typically results in pennies on the dollar for actual costs realized from the fraud that occurs following the data thefts.

To protect member assets the credit union will soon begin restricting daily VISA Debit Card activity to a maximum amount of $1,500.00 per day. Members will have an additional $500.00 per day available in cash from an ATM. These will be the default daily card limits on all VISA Debit Cards. In addition to these changes, a cap of no more than 5 transactions per hour will be in place. Again, these changes are necessary because the merchants have not shown the ability to protect card data being used in their businesses. As it stands now, card data is being stolen from the merchants and counterfeit cards are being produced and used to steal money from member accounts. If merchants were bearing the costs for these counterfeit transactions that would be a different story, but they are not. VISA liability rules have been protecting the merchants from responsibility over counterfeit card use.

If members know that they will have purchases that will exceed the $1,500.00 daily amount they can call or visit one of our offices to request a higher temporary purchase limit for a specified period.

We regret having to make these operational changes with regards to VISA Debit Cards. Consumers have grown very accustomed to using VISA Debit Cards like cash. Unfortunately the thieves have also grown fond of VISA Debit Cards. Since North Alabama Educators Credit Union is ultimately responsible for all unauthorized card activity, we had no choice but to take appropriate steps to reduce the card losses that affect the entire credit union membership.

These changes are scheduled to be fully in place by November 1, 2014 following notifications and educational communications to our membership.

Friday, August 29, 2014

NAECU Official Checks being Counterfeited

North Alabama Educators Credit Union is once again seeing counterfeit checks being produced and distributed that have the name of the credit union on the checks. These fake checks are being sent throughout the country by scammers in conjunction with fake secret shopper job offers. Potential victims are being mailed a check that appears to be drawn off of North Alabama Educators Credit Union as either an Official Check or Cashier's Check. Any counterfeited check will be sent back as "fictitious item". The credit union did not produce these checks or lose any check stock. These counterfeit checks are being produced by thieves using common check software available at many office supply stores. So far all of these counterfeit checks are being handled and presented in states outside of Alabama.

Many financial institutions across the country see their checks being counterfeited from time to time since checks are sent for legitimate reasons all over the country for valid transactions. Consumers are advised to treat unknown checks with caution, especially any checks received as part of a work from home offer. Checks received through the mail from strangers is always a huge red flag to stop and question the transaction being requested. Consumers are advised to contact the financial institution that the check is written on to verify the check item as being real and negotiable.

Anyone receiving an Official Check or Cashier's Check drawn on North Alabama Educators Credit Union can verify the item by calling our main office at 1-800-547-8172. 

Wednesday, July 30, 2014

Financial Scam Avoided - Success Story

On a regular basis we read and hear about people becoming financial victims of scams and fraud. It was thus very rewarding to know that North Alabama Educators Credit Union was instrumental in preventing an elderly member from being cheated out of $10,000.00 from local con artists. The credit union staff did an excellent job of identifying the red flags that something was amiss and then taking the proper steps to prevent the member from losing her money.

The scam attempt took place on July 17th of this year at our main office location. An elderly member had come into the office to withdraw $10,000.00 cash from an account that she had here at the credit union. She was specific about the need for cash and declined any recommendations for a check for that amount. The staff asked questions about the purpose of the cash withdrawal which was met with concerns by the staff since it was indicated that the funds would be returning soon. There was also an unknown person with the member who was waiting in the lobby for the transaction to be completed. These were definite red flag warnings since it appeared as if some form of questionable investment was possibly taking place. Per standard policy, the credit union employee informed the member that a 15-minute wait was required for larger cash withdrawals. It was during this 15-minute wait period that the unknown person sitting in the lobby decided to leave the office and proceeded to walk down the street. Most likely, the con artist was fearful that police had been called to investigate the transaction.

Additional private conversations with the elderly member did reveal that she did not know the two people (one had stayed outside) she had brought to the credit union. They had showed our member a “wad of money” and her cash transaction was going to be a money exchange for a profit. Known as the Pigeon Drop Scam, the victim loses their money rather than making money. Management was able to convince the member to redeposit the cash and speak to the police about the people involved in the fraud attempt.

Members are encouraged to exercise great caution when dealing with strangers on any investment offer that requires cash. Unfortunately, the elderly are often targeted for these type of scams. Luckily this credit union example had a happy ending!

Friday, May 23, 2014

Memorial Day - Honor the Fallen

Memorial Day is not just another 3-day holiday weekend. While people are grilling, traveling, having fun with friends and families, others are not so jovial. Family members of fallen soldiers see Memorial Day as what it should be, a respectful recognition of the ultimate sacrifice given. The politics of war will never be clear but what is clear is that honorable Americans serve their country and sometimes those Americans die during the course of that service. Twenty one service members have died so far this year. One hundred thirty two were killed during 2013. The families of these one hundred fifty three service members will have a very different experience this Memorial Day. These fallen soldiers along with the many more over the history of this country gave their lives in the most ultimate sacrifice anyone can give their country. Please consider taking some time this Memorial Day weekend to reflect on those who have fallen to protect the freedoms that we enjoy each and every day. 

Visit this web site to see the names and faces of those service members who have fallen just in the last few years. The ultimate sacrifice is still taking place for our fellow Americans. 

Tuesday, May 13, 2014

Together Magazine for NAECU

The credit union has developed a new magazine, "together", for our current and potential members to assist in financial and lifestyle events. Educational tools to help improve the financial literacy of consumers is a priority these days of credit unions across the country. North Alabama Educators Credit Union has seen first hand how credit union members can make bad financial decisions at times simply because the knowledge was not available at the time of an important financial transaction. Our "together" magazine is designed to provide useful tips and tools BEFORE a financial event takes place. The new magazine format has value throughout the year, not just during the season it is published. 

We encourage our current members and potential members throughout the Tennessee Valley to review the magazine and share with family and friends. Our objective is to prevent buyer's remorse and fraud when making financial decisions outside of the credit union. Unlike the credit union philosophy, most businesses and sellers are driven to maximize the most profit they can obtain from a unknowing consumer. Having good financial education tools available is beneficial for consumers in keeping more of their hard-earned dollars. 

Here is an e-version of the "together" magazine. We hope that you find it useful!! 

Tuesday, March 4, 2014

Grandparents Scam - Who is that Caller?

Everyone dreads the late night or early morning phone call that wakes you up from a deep sleep. Those calls usually end of being (1) bad news about a family member, or (2) a wrong number. A third reason for that untimely call is growing in popularity - a phone scam! Con artists are placing calls to elderly people in the middle of the night and claiming to be either a grandson or granddaughter in need of urgent financial help. The callers claim to have been in either an accident or some form of legal trouble where they need immediate access to funds to escape from their dire situation. These callers usually don't actually know the name of the grandchild but will rely on the grandparent to provide the name themselves in their confusion and concern. At times though the callers may have obtained names from a recent obituary notice or other public records search.

The caller will ask for either a credit card number to help them or request that a wire transfer be done as soon as their financial institution opens. The credit union recently had one of these attempts this past Friday where someone acting as a District Attorney placed a second call to the victim stating that the cash bond had been reduced if they could expedite the movement of the cash. Luckily the grandparent's real son in this scam attempt recognized the calls as fraudulent and contacted us about the fraud attempt. Unfortunately though there are hundreds of cases nationwide where thousands of dollars has been stolen in this manner from grandparents who thought they were helping out their loved ones.

When in doubt over any situation, verify the story and sources involved. A quick verification call to real family members would expose the scam. If a person is being held in a jail somewhere, obtain the police jurisdiction information and contact that police department independently with a telephone number that you obtain and verify on your own. A hospital story would work the same way. Find out the hospital name and location and verify a contact number either online or through directory assistance.

Be very cautious in any situation where you are being asked to transfer money, especially when urgency and privacy are highlighted by those requesting the transfer.

Wednesday, January 22, 2014

Guaranteed Auto Protection (GAP) - Less Expensive at the Credit Union

Members financing new and used automobiles are faced with multiple financial decisions that are connected with the vehicle purchase. One of these decisions is Guaranteed Auto Protection, known as GAP coverage. Will your insurance company payoff your outstanding loan balance if your vehicle is deemed a total loss? GAP coverage is designed to payoff any remaining balance that might exist after a total loss claim by an insurance company. Unfortunately, vehicles as a general rule are not very good investments. They decline in value rather quickly the first few years and more gradually with each additional year. Insurance companies have a wide array of resources in determining the current market value of a vehicle that has been deemed a total loss. The remaining loan balance is not one of those resources. If a member has a vehicle with a $15,000 payoff balance and the insurance total loss claim is only $12,000, that member now has a $3,000 deficiency balance that they are still responsible for. If GAP coverage had been purchased, that $3,000 balance would be paid for by the GAP provider.

Does every vehicle financed need GAP coverage? No. Vehicles with a modest down payment and a good depreciation history would most likely not need GAP coverage. A "Visual GAP" report is available to predict any anticipated GAP balance over the amortized life of the loan. Loans where a trade-in has been involved or 100% retail financing provided are the best candidates for GAP coverage. Again, the "Visual Gap" report is the best tool to make an informed decision on whether to purchase the GAP coverage.

What does GAP cost? This is where financial education on this product is extremely valuable. North Alabama Educators Credit Union sells our GAP protection plan for a flat $195.00 fee per covered loan. Automobile dealers are routinely charging anywhere from $500.00 to $700.00 and higher for GAP plans and enjoying an incredible profit in the process. The credit union has refinanced automobile loans for members who have seen a refund of $400.00 or so by cancelling the GAP plan they purchased at the dealership. Keep in mind that most GAP plans are financed in with the vehicle loan so interest is also being paid on top of the cost of the GAP plan.

Anyone considering a vehicle to be financed is encouraged to check with the credit union first about our available loan rates and associated products like GAP protection. Remember that our objective is to provide a good financial value back to the member-owners of the credit union. Research into the costs of financing and protecting a vehicle purchase BEFORE negotiating a deal is the best advice for securing a good financial transaction.