In Attempt to Curb ID Theft, Arizona FCU to Limit Account Access

PHOENIX – Taking a leadership position among both Arizona banks and credit unions on identity theft, Arizona Federal Credit Union is joining a state-sponsored program allowing members to voluntarily restrict access to their accounts. The program, called “Fraud Fighter” accounts, is being launched by state Attorney General Terry Goddard and is aimed at protecting vulnerable seniors and the disabled from financial fraud by imposing voluntary limits on withdrawals and by delaying suspicious electronic transactions under a notification procedure. So far the $1.4 billion Arizona FCU is the only bank or CU agreeing to debut the accounts some time this summer with AG officials praising the state’s second largest CU for pioneering the program at a time when Arizona holds the dubious distinction as the U.S. capital of ID theft. Data from the Federal Trade Commission show the state has the highest ID theft caseload with “caregivers” and others cited as the worst ID theft culprits, preying on the elderly and disabled. Ron Westad, president/CEO of Arizona FCU who joined Goddard Feb. 27 to brief reporters on “Fraud Fighter,” said his CU has been working with the attorney general’s office on the project since last summer, seeing its participation as a means of contributing its resources to fighting ID fraud. Westad acknowledged there is a certain amount of risk in tackling the subject in this way since it raises an unwarranted specter of account security, but in the long run Arizona FCU felt the program had merit “in providing value to those members who need it most.” A spokeswoman for Goddard, a Democrat, said it expects other banks and CUs will soon join “Fraud Fighter” noting officials of Chase Bank “expressed interest last week.” Westad said he told “some of my brethren last fall” of Arizona FCU’s plans to help Goddard during a CU meeting “and one or two said they were interested” but so far no other CU has stepped forward. “I saw no reason to turn my back on cooperating with the state,” said Westad. “Let’s be a little different.” The Arizona FCU said his staff over the next few weeks will be working with Goddard’s office to develop the “tools, both biometric and old-fashioned human intervention” to reduce fraud. The accounts, Goddard told reporters, “are for those people most vulnerable to identity theft or fraud because of disabilities, health or because their financial security was already compromised.” Under “Fraud Fighter,” consumers will have “several options to protect their accounts,” Goddard told reporters. First, they can limit daily and monthly withdrawals. Second, they can notify “a trusted third party if suspicious transactions are attempted delaying them and third, limit electronic access to accounts. “These accounts will provide a safety net for those who have special concerns about their financial safety,” said Goddard. “We have to make efforts to proactively protect ourselves and seniors.” The Goddard spokeswoman said trust accounts at banks have been a particular source for ID fraud by caregivers and so the state hopes to interest banks in joining the program to curb that trend. Westad said Fraud Fighter “will give a little peace of mind” to members who are most vulnerable. -