PONTE VEDRA BEACH, Fla. — As members concerned about privacy and identity theft shy away from using your credit union's Internet connections, their worries may actually create a marketing opportunity.
Speaking at the Education Credit Union Council annual conference, Remar Sutton of Remar Sutton Associates pointed out lackluster growth in online banking means potential loss of income to financial institutions, including credit unions.
"Your member has lost control of their personal information," he declared. He decried federal legislation that requires "opting out" rather than "opting in," describing it as "the difference between 'lightning' and a 'lightning bug.'"
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The statement "because we value your privacy" on disclosures consumers receive is "a phony message," Sutton stated. "Most of the privacy statements you get in the mail have 7,000 words. Businesses are careless about security and casual when security theft happens." He cited examples of online forums in which criminals trade, sell and match personal information they have obtained. The range of details on those sites is growing daily, he indicated, and scammers can browse menus. For example, a driver's license number may sell for $150. "There are 26,000 different phishers operating," Sutton warned. "Your members receive 10 e-mail phishes each week. Credit unions are a favorite target of organized crime. Why? They don't have sophisticated protection. They're easier to crack." Sutton said a Unisys Corp. study found nearly 80% of consumers are willing to switch financial institutions for better security. Banks are claiming the high ground, with giants such as Chase and Bank of America offering advice on their Web sites outlining how consumers can protect themselves from identity theft.
"It's an opportunity for us. We can be a solution," Sutton said. "Let's own privacy and fraud issues. We have to be proactive. We have to become the member's source of all information on privacy and fraud. We want our members to see us as advocates."
He listed specific steps credit unions can take:
o Make funding of security projects your highest priority. How well are you listening to your IT department's needs?
o Involve the board. The board sets the agenda.
o Incorporate privacy and identity theft articles into all of your newsletters and into many places on your Web site. Sutton and Associates provides free articles through their Web site, www.remarsuttonassociates.com/privacy.
o Make "opting out" easy to do.
o Raise your staff's awareness of privacy and fraud issues. You are a winner every time a staff person talks to a member about privacy and fraud. The first place to start raising awareness is with senior staff.
o Don't sell information to outsiders.
o Don't be afraid your members will be scared away by privacy and fraud talk. Your members are already uneasy. –[email protected]
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