2010 Banking Identity Safety Scorecard: PIN-Debit Zero Liability Fraud Limitations Leave Consumers Exposed

Javelin Strategy & Research, December 2010, Pages: 46

Javelin’s Sixth Annual Banking Identity Safety Scorecard evaluates customer-facing customer security by 2 credit unions and the top 25 banks by DDA size. With identity fraud losses and incidence rates at an all-time high, security practices are weighted and scrutinized more heavily. Javelin added 12 new criteria to this year’s scorecard, drastically raising the bar for financial institutions (FIs) and increasing the rigor by which they are measured. Surprisingly, FIs are moving in the wrong direction with SSN security and authentication, and there are increasing caveats and restrictions for zero-liability offerings. Additionally, banks are challenged to improve prevention offerings and features that will help prevent and detect against new accounts fraud.

Primary Questions:

- Which financial institutions scored best in prevention, detection and resolution capabilities?

- Where are financial institutions most vulnerable?

- In what areas did FIs improve and succeed in offering customer-facing security best practices?

- Is there a correlation between customer-facing identity safety effectiveness and how safe a consumer feels?

- How do FIs fare in prevention, detection and resolution capabilities compared with previous years?

- What should financial institutions expect in 2011 and how should they adapt to upcoming trends in identity fraud security?

Methodology

This report ranks the top 25 banks and the 2 credit unions able to be scored longitudinally on their customer-facing identity fraud detection, prevention, and resolution capabilities. The top 25 banks were determined by largest deposit size of demand deposit accounts (DDA) according to the FFIEC. The study focuses on customer-involved identity fraud capabilities deemed valuable from Javelin’s annual Identity Fraud Survey Report and from speaking with industry professionals.

Research was conducted in August and October 2010 through thorough website review and calls to surveyed bank and credit union customer service centers. Whenever information could be found online on an FI’s website, the link was recorded and screenshots were taken.

The mean number of calls made to customer-service representatives (CSRs) was 6.9. Calls were made to the following customer service departments as appropriate: general, online banking, mobile banking, personal banking, credit card, and fraud. When there was reason to doubt the knowledge or tenure of a CSR or when contradictory information was given, multiple follow-up calls were made to that institution regarding the disputed offerings.

Overview
Primary Questions
Methodology
Key Findings & Recommendations
Executive Summary
Identity Fraud is On the Rise
Prevention, Detection and Resolution Scores
Behind-the-Scenes Security
Overall Rankings
Prevention
Prevention Rankings
Prevention Criteria
Detection
Detection Rankings
Detection Criteria
Resolution
Resolution Rankings
Resolution Criteria
Appendix
Related Research
Companies Mentioned

List of Figures:

Figure 1: New Accounts Fraud Drives the Increase in Total Dollar Fraud
Figure 2: Prevention, Detection and Resolution Scores, 2008-2010
Figure 3: Overall Rankings, First to Tenth Place
Figure 4: Overall Scores 14-27
Figure 5: Top Prevention Performers, First Through Ninth Place
Figure 6: Prevention Scores, 14-27
Figure 7: Prevention Criteria
Figure 8: Authentication Criteria
Figure 9: Education Criteria
Figure 10: Detection Rankings, First Through Eighth
Figure 11: Detection Rankings, 11-27
Figure 12: Detection Criteria
Figure 13: Account-Related Alerts
Figure 14: Personal-Information Change Alerts
Figure 15: Resolution Rankings, First Through Ninth
Figure 16: Resolution Rankings, 13 to 26
Figure 17: Resolution Criteria
Figure 18: Zero-Liability Criteria
Figure 19: Total Score
Figure 20: Prevention Scores
Figure 21: Authentication Scores
Figure 22: Education Scores
Figure 23: Detection Scores
Figure 24: Account-Related Alerts Scores
Figure 25: Personal-Information Change-Related Alerts Scores
Figure 26: Resolution Scores
Figure 27: Zero-Liability Scores
Figure 28: Most Valuable Alerts by FIs and Consumers

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