PSCU Saves Over $277 Million in Fraud for Owner Credit Unions

The St. Petersburg, Fla.-based payments CUSO PSCU reported it prevented over $277 million in potential fraud across multiple channels including the point of sale, contact center, online and other channels.

This fraud avoidance by PSCU for owner credit unions and members in 2019 represented an increase of $67 million (more than 30%) compared to 2018. PSCU said it continues to invest in “best-in-class” fraud-fighting tools, including machine learning and data analytics capabilities across multiple channels, while continuing to deliver a member experience with a 99.6% transaction approval rate.

“As fraud becomes more frequent and advanced, PSCU is committed to developing and investing in leading technologies to prevent, fight and mitigate fraud loss for our owner credit unions,” Jack Lynch, SVP, chief risk officer at PSCU and president of CU Recovery, said. “Through our proprietary tools and expertise, we are able to better protect our owner credit unions and their members to stop fraud at every point of attack, while also minimizing financial and reputational risk associated with fraudulent activity. At the same time, we remain committed to preserving the member experience and ensuring successful transactions at the point of sale.”

PSCU explained it utilizes a multi-layered method to fight fraud, employing a number of technologies and best practices. This includes PSCU’s Linked Analysis, which helped the CUSO secure more than $38.7 million in fraud mitigation in 2019 by preventing fraud. Developed by PSCU’s in-house fraud experts, this tool uses cross-network analytics to create a 360-degree view of a member, enabling PSCU to link events through artificial intelligence across different platforms, individuals across different institutions, merchants across any card and all of these points to each other. Using these connections, data scientists at PSCU then utilize research and machine learning to proactively take action.

In 2017, PSCU began utilizing Pindrop to fight contact center authentication fraud. In 2019, the CUSO secured over $22 million in savings through this unique platform. With the help of Pindrop, PSCU proactively blocks attempted contact center fraud and moves quickly to protect the available credit of those accounts from potential fraud loss.

In addition to these solutions, PSCU offers Enhanced Fraud Services that provide additional fraud-fighting capabilities. This includes an assigned fraud consultant, which enables a more customized approach for a seamless member experience that fits a credit union’s vision. Ongoing dark web monitoring, dedicated portfolio observation and an understanding of the credit union’s risk tolerance fosters faster and more effective fraud detection by the CUSO.

“Fraudsters are becoming increasingly sophisticated – no single defense can withstand the constant barrage from probing criminals,” Lynch added. “That is why PSCU’s multi-layered approach, utilizing the most innovative technologies and processes available, has made us an industry leader in providing anti-fraud solutions to our owner credit unions, protecting them against losses from fraud, lost/stolen accounts and disputed transactions, among other threats.”