CommunityBank of Texas Reduces Fraud Impact

When the fraud monitoring systems used by CommunityBank of Texas proved unable to stop a sudden rush of fraudulent transactions, they turned to PULSE for help. PULSE’s custom DebitProtect® Authorization Blocking stopped the onslaught and gave them a long-term solution for future attacks.

“Fraud can be an inconvenience to the cardholder and can reflect poorly on a bank’s reputation, so we take it seriously,” said Donna Dean CommunityBank of Texas manager of the Electronic Banking Department.

Background

CommunityBank of Texas is a large independent bank focused on the financial needs of Southeast Texas. Currently they have 35 locations and $2.8 billion in total assets. 

Challenge

Donna first realized something was not right when she was alerted by her fraud monitoring system that several suspicious transactions had occurred about 15 minutes beforehand. Her investigation found that multiple debit cards with the same number were being used simultaneously at a large merchant. In the span of about five minutes, the cards were used 20 to 30 times.

“All the transactions were below the $50 price point, so no PIN or signature authentication was required,” said Dean.

Fraudsters were capitalizing on the fact that large retailers were routing transactions with no cardholder verification, and those transactions were not being backed by the traditional fraud-monitoring services that typically accompany such payments.

“It was frustrating, trying to determine why this was happening,” said Dean. “We did not know if there was a breach or the extent of the problem. And, we didn’t understand why our existing tools were not catching things fast enough to prevent the fraud. I needed a solution fast.”

She called her PULSE relationship manager for assistance.

Solution

After listening to CommunityBank of Texas and understanding their problem, PULSE Account Executive, Lisa Roemer, suggested PULSE’s DebitProtect® Custom Authorization Blocking services. Debit Protect could add an additional layer of security to supplement their current fraud systems.

DebitProtect allows users to create and refine specific transaction blocking rules in response to changing fraud patterns, and to tailor the rules to their specific needs and risk tolerance.

PULSE’s dedicated team of expert Fraud Analysts provide issuers with a personal touch. The team evaluates an institution’s transaction patterns and analyzes fraud trends to define targeted strategies.  The Analysts then quickly test the strategies to determine how effective the rules will be at mitigating fraud while creating as little impact as possible to valid cardholder activity.    

Implementation

CommunityBank of Texas collaborated with PULSE’S Fraud Analysts to develop blocking rules specific to what they were experiencing: small-ticket transactions that did not require a PIN or signature. 

“We did not want legitimate customers to be inconvenienced, so PULSE worked with us to find the right balance of effective rules to reduce losses without too much disruption,” said Dean.

Results

DebitProtect strengthened the bank’s existing fraud-mitigation systems. The solution, immediately stopped fraud attempts on multiple cards that could have otherwise turned into hundreds of transactions and thousands of dollars in fraud.

“The system worked well in coordination with our existing system,” said Dean. “We put in one DebitProtect blocking rule to start with, and it was effective immediately. We have since added more rules as fraud patterns have changed.”

Since the fraud event, the bank has continued to reap the benefits of partnering with the DebitProtect team. For instance, Dean and her team regularly consult with PULSE on ways to protect their cardholders. Furthermore, the bank has proactively setup additional rules around ATM and other transactions at the recommendation of PULSE’s Fraud Analysts.

“Working with the experts on the DebitProtect team has been great and one of the reasons why we value our relationship with PULSE.  Our new fraud-mitigation strategy has decreased our exposure to events like this.” said Dean. “Unfortunately, fraud is a cost of doing business, but DebitProtect prevents the cost from dramatically impacting our bottom line.”

As fraud morphs and evolves, DebitProtect continues to help CommunityBank of Texas and other issuers keep pace without impacting legitimate cardholder purchases.

For more information

To learn how PULSE can help your financial institution to mitigate fraud while reducing the inconvenience of fraud to cardholders, contact your Account Executive at 800-420-2122 or 877-247-8573 or visit us at  www.pulsenetwork.com/fraud/debitprotect.html.

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