Financial institutions to battle identity theft - East Valley Tribune: News

Financial institutions to battle identity theft

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Posted: Wednesday, August 11, 2004 1:31 pm | Updated: 4:26 pm, Thu Oct 6, 2011.

Banks and other financial institutions will have a powerful new tool starting later this month to combat identity theft across Arizona.

The Arizona Bankers Association will begin rolling out the Fraud-Net online network later this week. As of January, Arizona ranks No. 1 in identity theft per capita, according to the Federal Trade Commission.

The commission defines identity theft as “someone appropriating your personal information without your knowledge to commit fraud or theft.”

Banks and credit card companies that are members of the Arizona Bankers Association will have access to the Fraud-Net system. A gradual rollout begins later this week.

Consumers can find out whether their bank will have access to Fraud-Net by contacting the association at (602) 258-1200.

Fraud-Net eliminates the time delay that allows criminals to move from financial institution to financial institution committing fraud. It is active in 21 states, and is being offered at no charge to all 59 members of the association, as well as law enforcement.

“With Fraud-Net, when a transaction takes place and it does raise a red flag for the fraud and security officers . . . they'll be able to send that information out to law enforcement and all of the fraud and security officers at every other bank,” said Tanya Wheeless, president and CEO of the Arizona Bankers

Association. “It's an information sharing network.”

Identity thieves will no longer be able to hit multiple banks or institutions before their activity is detected, she said.

“We could potentially identify any case of identity theft where someone is using someone else's identity or personal information, whether they use that information from a check or try to open an account under that person's name,” Wheeless said.

“From day one, customers will benefit from this information sharing.”

Fraud-Net debuted in Florida more than two years ago and 85 percent of the banks in that state are using the system.

“Think of Fraud-Net like a neighborhood watch for financial institutions,” said Thomas Kerr, senior vice president and chief financial officer of the Florida Bankers Association. “We have a community now of bankers and law enforcement who are much better informed about the activities that are affecting different parts of our state. If a bank gets hit with a particular fraudulent scam or crime, or incident, where applicable they let other bankers and law enforcement in the area know that this crime has occurred so they can be on the lookout.”

The benefits of Fraud-Net are twofold, he said. First, it keeps identity thieves from hitting multiple banks and institutions, thereby limiting the amount of damage they can commit with a stolen identity, he said.

Secondly, it enables law enforcement to tie more incidents of theft to the perpetrators who commit them, thereby ensuring more effective prosecution,

Kerr said.

“A $1,000 check loss may not get a lot of attention by itself, but if you have

several check losses and they can tie them together to the same individual, it gets more attention from law enforcement,” he said. “At the level when it's prosecuted, the penalties are stiffer when you increase the number of counts and the dollar value.”

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