CO-OP Adds Fraud Score Tool to COOPER Platform

CO-OP Financial Services announced the rollout of a new fraud-fighting tool Monday – COOPER Fraud Score, a credit union-focused, real-time payments fraud scoring tool and the latest addition to the AI-driven fraud mitigation platform COOPER, which CO-OP introduced in 2018.

The Rancho Cucamonga, Calif.-based payments CUSO said COOPER Fraud Score is designed accurately detect more fraud, helping credit unions react quickly to emerging trends and build more member confidence in their credit union-issued cards. It works by creating a risk score in real-time and applying it to a transaction authorization request, then delivering the score to a range of decisioning tools within CO-OP’s fraud prevention ecosystem. If a transaction is identified as potentially fraudulent, the credit union receives “reason codes” that explain why the solution assigned it the scores it did; the credit union can then choose to relay this information to members, helping them understand why a particular transaction was declined.

“The beauty of real-time transaction data and machine learning technology is immediacy,” CO-OP Chief Product Officer Bruce Dragt stated. “The technology generates cost savings from reduced false positives, fraud chargebacks and fraud losses. Just as importantly, though, is the increased trust and reliability members gain when they experience fewer hiccups in the day-to-day movement of money. COOPER Fraud Score’s advanced fraud-fighting technology helps buoy the primary financial relationships credit unions are working so hard to earn and maintain.”

COOPER Fraud Score is platform-wide, meaning it is integrated into CO-OP’s real-time decisioning tools across credit, signature/PIN debit and ATM transactions, and in addition, it enables CO-OP fraud prevention consultants to set custom strategies for individual credit unions, CO-OP said.

“A key differentiator for COOPER Fraud Score is the integrated team of credit union-centric experts working alongside the technology,” Dragt added. “CO-OP’s fraud team consists of data scientists, prevention consultants and detection analysts, all working to monitor COOPER Fraud Score and apply its use in fraud-fighting strategies. Continually learning from the solution’s data feedback loop, as well as emerging fraud trends and use cases, the team is highly focused on outcomes and model efficacy. Because they understand credit unions as much as they do fraud risk, the member experience is always a top priority.”

The new solution’s rollout came at a time when payments fraud risk is high due to consumers’ continued preference for digital payments during the pandemic. According to TransUnion research released last week, 19.66% of U.S. e-commerce transactions for the shopping period of Thanksgiving to Cyber Monday this year were suspected to be fraudulent. In 2018, 11.76% of U.S. e-commerce transactions were flagged as fraudulent during that time period, and the percentage has remained relatively flat for the past two years, with TransUnion reporting it as 19.94% in 2019 and 19.70% in 2020.

CO-OP noted that BIN (Bank Identification Number) attacks, which the COOPER Fraud Score addresses along with other vulnerabilities, have been an issue for card issuers during the pandemic. Last month, the $7.6 billion Redstone Federal Credit Union in Huntsville, Ala., was hit with a BIN attack.