How Redstone FCU's Real-Time Detection System Nabbed ATM Theft Suspect

A 24/7 real-time detection solution enabled the $7 billion Redstone Credit Union in Huntsville, Ala., to nab a suspect who allegedly stole more than $100,000 from ATMs in just one month.

Allen Devon Rutledge, 31, of Birmingham, was indicted on eight felony counts of bank fraud, attempted and conspiracy to commit mail fraud, identification fraud and using a counterfeit device. His trial has been set for December in U.S. District Court in Huntsville.

Redstone’s real-time detection system caught Rutledge one night in April, which led to a police and federal investigation that led to his indictment in August.

“The individual was still sitting there at a [non-Redstone] ATM using cards when police rolled up and after a short chase, they were able to apprehend him,” Redstone Vice President of Security and Investigations Jonathan Kirby said. “That was a huge success story.”

In 2020, Redstone turned on EMV for its ATMs so they would only accept chip-enabled cards. Rutledge, it turned out, was using forged magnetic-stripe Redstone cards that were not chip-enabled. That forced Rutledge to use other bank ATMs that did not have EMV.

The Huntsville police investigation determined that Rutledge allegedly used the stolen identities and other information of up to 149 Redstone members. He also allegedly used counterfeit credit union debit cards to steal more than $100,000 from non-Redstone ATMs in just one month.

But Redstone caught up with Rutledge soon after the credit union began to work with its Denver-based vendor TOOLCase, which develops customize AI, remote data and system administration service delivery solutions for their clients.

The credit union and TOOLCase wrote custom rules into the software system based on the criminal’s theft patterns or trends such as the likely times that the theft could occur, the approximate amount of funds stolen and at which specific foreign ATM locations.

On the night of April 30, Redstone received a real-time alert that Rutledge was allegedly using the credit union’s cards at a (non-Redstone) ATM and immediately called police who were aware of the technology that Redstone was using to catch the suspect.

“When the [ATM] transaction occurred at 10:30 we got a real-time alert, there was no five- or 10-minute lag time, and that’s why this real-time system is huge,” Kirby said.

Rutledge’s federal indictment showed that he used an alias to establish a group chat in Telegram, an encrypted instant messaging service, where he met an individual identified in court documents as Shawn Storm. Prosecutors alleged Storm provided Rutledge with debit card numbers and related information to Redstone member accounts. Using a card encoder Rutledge then transferred the stolen debit card information onto magnetic-stripes on phony debit cards that were used to steal funds from member accounts.

According to federal prosecutors, Rutledge would typically transfer $500 from a member’s savings account and place it in the member’s checking account, from which he withdrew $480.