It's true! Without even realizing what they're saying, a financial institution in Illinois, has "eliminated" pay at the pump privileges for their cardholders and has temporarily barred it's card holders from using signature debit, requiring them to use the safer and more secure PIN based technology.
What the bank has essentially done is openly admitted that even though they "push" signature debit, when "push" comes to "shove", even they PREFER PIN debit. (only in self-interest...to protect themselves against further losses incurred by having their cardholders continue to use signature debit)
Interesting, to say the least, and maybe even part of the paradigm shift! Wonder if the card users will continue to "earn rewards" since the bank is "forcing" them to use their PIN?
What the bank has essentially done is openly admitted that even though they "push" signature debit, when "push" comes to "shove", even they PREFER PIN debit. (only in self-interest...to protect themselves against further losses incurred by having their cardholders continue to use signature debit)
Interesting, to say the least, and maybe even part of the paradigm shift! Wonder if the card users will continue to "earn rewards" since the bank is "forcing" them to use their PIN?
Financial institutions already suffering from our weak economy have another worry on their plates: fraud. A scam targeting banks and credit unions could drain our accounts in days, if we're not vigilant.
"To combat the problem, Illinois Community Credit Union eliminated pay at-the-pump privileges for card holders and temporarily barred signature debit card transactions. Customers have to use a PIN instead."
Editor's Note: Consider that all debit transactions done on the Internet are classified as Signature Debit "without the signature", so feel free to draw your own conclusions as to the risk factors involved. If combating the problem includes banks temporarily "barring signature debit" transactions, (and "signature debit" is far less risky than the "card not present" debit model used for online shopping), what conclusions can you make about how the "bank feels" regarding inherent risks of accepting this payment methodology?
The fact that the bank/credit union puts forth the mandate: "Customers have to use a PIN instead" is a blatant admission by this particular financial institution that PIN Debit is more secure...which is a fact that we at HomeATM have been stating all along.
The story continues...
A little lighter in the wallet," says Daniel Matuszewski. He had an unwelcome surprise while checking his account balance at Illinois Community Credit Union in Sycamore. He noticed a series of unfamiliar charges that added up quickly.
"It was quite a schock because I mean 900 dollars is quite a bit of money just to be missing," says Matuszewski. He fell victim to a fraud scheme catching on across the Stateline and the country.
"They're moving from state to state and they're going to different financial institutions and if you're not doing your homework then you have the potential of really getting stung bad on this one," says Bob Schroeder, President of Illinois Community Credit Union.
Law enforcement agencies are working with Visa International to trace the fraud. They believe the suspects are mass-producing credit and debit cards, then testing them at pay-at-the-pump gas stations, until they find one that matches an existing account.
But Schroeder says the most important tool is to constantly monitor transactions to check for suspicious activity. Illinois Community caught the trend early enough that just 30 of 5,000 card holders were impacted. The credit union is repaying customers for all fraudulent charges, adding up to a $30,000 loss for the company. Schroeder feels lucky it wasn't worse:
"With earnings of financial institutions down it's gonna cause some problems." Investigators also believe the individuals committing the fraud may be people laid off from the financial sector, who know how the system works and no longer have a paycheck.
He adds Illinois Community Credit Union is working with law enforcement to find the people behind the scheme. He says security cameras recently caught some suspects on tape in a Chicago suburb and he hopes for resolution soon.
![Reblog this post [with Zemanta]](https://lh3.googleusercontent.com/blogger_img_proxy/AEn0k_sPK6vcxxL6XCl6I_ULCU4Kr3Zap2nnSf1ENdwQ8aUigNfZr9dxOMCPFLGTBZcHJrkNUDv4oal-_7bTiu9aO_t4Nv96MtnNPUVklYE9jMf2bZQgoHxkgXr1bsoDdGWNuY6OjU08VodSc9a-PbEVC_BW=s0-d)
