Cutting Fraud Loss By 70% & Cracking Down on ATOs By Moving Off a Rigid Legacy Vendor
The Problem: A Rigid System With Nightly Batching Led to Significant Losses Via Account Takeovers
Service Credit Union was facing a year-over-year increase in fraud loss, with a specific concern about the ongoing sophistication of account takeovers.
Tyler Pihl, VP of Enterprise Risk, reflected, “While fraud losses were our biggest concern at the time, it came down to the limitations of our system. Two main factors of our tool were holding us back. The timeliness of the data we received and the timeliness of the alerts–meaning the ability to influence how and when alerts were generated.”
The legacy system was only able to provide alerts in nightly batches and lacked customization. "Frequent account takeovers–as much as 10-20 successful ATOs daily–were leading to major fraud losses, in the upwards of millions per quarter. These fraudulent ATOs were done through internal transfers, but our previous system saw internal transfers as non-threatening activities and with a rigid system in place there was no rule or model I could deploy to flag this fraud. Fraudsters would take the money in just under 5 minutes–our legacy system just couldn’t compete.”
Summary of Service Credit Union's Problem:
- Experienced 10-20 successful account takeovers, daily
- 24-hour batch alerting was inadequate to sufficiently detect fraud
- One-size-fits-all alerts were unable to detect fraudulent internal transfer transactions
- Frustrated by the inability to influence how alerts were generated
The Problem: A Rigid System With Nightly Batching Led to Significant Losses Via Account Takeovers
Service Credit Union was facing a year-over-year increase in fraud loss, with a specific concern about the ongoing sophistication of account takeovers.
Tyler Pihl, VP of Enterprise Risk, reflected, “While fraud losses were our biggest concern at the time, it came down to the limitations of our system. Two main factors of our tool were holding us back. The timeliness of the data we received and the timeliness of the alerts–meaning the ability to influence how and when alerts were generated.”
The legacy system was only able to provide alerts in nightly batches and lacked customization. "Frequent account takeovers–as much as 10-20 successful ATOs daily–were leading to major fraud losses, in the upwards of millions per quarter. These fraudulent ATOs were done through internal transfers, but our previous system saw internal transfers as non-threatening activities and with a rigid system in place there was no rule or model I could deploy to flag this fraud. Fraudsters would take the money in just under 5 minutes–our legacy system just couldn’t compete.”
Summary of Service Credit Union's Problem:
- Experienced 10-20 successful account takeovers, daily
- 24-hour batch alerting was inadequate to sufficiently detect fraud
- One-size-fits-all alerts were unable to detect fraudulent internal transfer transactions
- Frustrated by the inability to influence how alerts were generated
“Just because it’s a ‘best-in-class’ tool does not mean it’s doing the job right. We could no longer rely on our vendor to protect us. We had to take charge.”
Why Unit21: One Flexible & Customizable Platform For Transaction Monitoring & Case Management
“I realized our vendor’s core capability of alerting on transactions–they essentially could not deliver promptly or be customized to the type of fraud we were experiencing. I then knew it was time to look elsewhere.”
Tyler and his team outlined business requirements seeking an integrated system that provided flexible transaction monitoring and case management. He wanted to avoid layering multiple systems together due to the cost of the tools, data, and people that would manage it.
“It’s important to me that we have a single place for transaction monitoring and case management–that we replaced that legacy system altogether. To properly fight fraud, I knew we had to influence what data we were looking at and what rules we use around that data.”
Service Credit Union chose Unit21 for its flexible data integration, customizable rule sets, ease of data mapping, API capabilities, and lastly, access to real-time data. Tyler and his team were able to fully replace the legacy system and manage transaction monitoring and case management in one agile, flexible, and fully customizable platform.
Summary of Why Service Credit Union Chose Unit21
- Custom fraud detection rules enhance precision
- Real-time data intake via APIs improved response rates
- Advanced data mapping refined alerts
- A flexible system enabled the integration of diverse data sources
- Tailored fraud prevention strategies for better security
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