Top-Level Takeaways
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Alert employees noticed a pattern of transactions.
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With software help, a gas station was identified as a source of the problem.
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A local police officer found a skimmer, and retailer videos helped identify the suspects.
Alert staff at Family Savings Credit Union ($407.7M, Rainbow City, AL) helped bust a gas pump skimming scheme that netted the thieves more than $43,000 and an arrest.
After Family Savings detected the scheme, card issuers, retailers, and law enforcement worked together to bring the swindle to an end in April 2017, says Paula Knowles, the credit union’s fraud analyst and debit/ACH supervisor. Authorities say seven financial institutions and more than 300 people in four states were victimized prior to that.
Member reports about suspicious transactions first alerted Family Savings’s call center to the issue.
CU QUICK FACTS
Family Savings Credit Union
Data as of 06.30.17
HQ: Rainbow City, AL
ASSETS: $407.7M
MEMBERS: 61,987
BRANCHES: 8
12-MO SHARE GROWTH: 11.9%
12-MO LOAN GROWTH: 8.4%
ROA: 0.41%
Our employees realized this was more than a coincidence, Knowles says.
So, armed with tools from the credit union’s security software, the supervisor dug in to research which Family Savings members were affected, and how. She cross-referenced checking account numbers across 30 days of transactions and found a common point of purchase: a gas station in Gadsden, AL.
Knowles alerted Deputy Chief Phillip Roberson of the Southside, AL, police department. He went to the station and discovered a skimmer on one of the pumps that sent stolen data through a Bluetooth device. The fraudster had been using that data to produce counterfeit cards and make fraudulent purchases in several Alabama and Georgia communities.
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The police alerted local and state prosecutors and the state attorney general’s office. Video surveillance from Wal-Mart, Publix, and Home Depot stores helped identify suspects, and an arrest was made.
The authorities report more than $43,000 in losses to debit card holders from seven financial institutions, but Knowles says the skimming cost her credit union alone more than $50,000.
Family Savings Credit Union uses Verafin’s fraud detection and anti-money laundering software. Find your next provider in Callahan’s online Buyer’s Guide.
We documented each claim on an Excel spreadsheet, the supervisor says. And these were only the ones reported to us.
According to Knowles, approximately 15 of her members were affected monetarily but the credit union re-issued 296 debit cards that members had used at the gas station.
A Fraud Fighter’s To-Do List
Paula Knowles offers these lessons from her experience as fraud analyst at Family Savings Credit Union:
- Have policies and procedures in place for dealing with fraud events.
- Make contacts with local police departments. Know who to talk to.
- Keep records of people, places, and anything else that might help an investigation.
- Cooperate with other local financial institutions.
- Be diligent and understanding about how this affects individual members.
The scamming skimmers managed to make multiple illegal purchases, but it could have been much worse had it not been stopped so quickly, says Alabama’s top lawmen.
Teamwork between local business and law enforcement made a difference in this case, said Attorney General Steve Marshall at a May 2 news conference. I would like to commend Family Savings Credit Union.
Knowles, for her part, is quick to share the credit. We have access to Verafin and very alert employees who noticed these strange transactions. At some point, someone would have been able to put the pieces together, she says, adding, I also can’t stress how lucky we are that we have a designated fraud department that allows us to focus strictly on these issues. I don’t know how other financial institutions get by without one.
A news release from the Alabama attorney general credits Family Trust for its role in solving the case. News articles provided a few more details, including about the arrests.
She also lauded law enforcement. I only have certain investigative limits, Knowles says. I can do a lot of the legwork and give police the information I have, but then it’s up to them to build the case.
It takes a village, Knowles adds. Deputy Chief Roberson worked day and night with many agencies for about a week to get to the point of arrest.
