Safe Guards Can Stop Theft

Retail and service-oriented businesses that don’t ask for identification from customers who present checks, debit or credit cards should start.

Mason McCoy, Arvest Springdale Bank & Trust’s risk management officer, said merchants who don’t do everything possible to verify a customer’s identity could have stolen amounts charged back to their store. McCoy said local banks are fighting the growing problem of stolen checks and cards every day.

His department handled about 150 fraud inquiries for Springdale Bank & Trust in 2000, although the majority of the inquiries involved only lost — not stolen — checks or cards. Arvest Bank Group Inc., the largest local banking firm, probably handled about 1,000 inquiries group-wide. It doesn’t disclose any other fraud loss information.

“If the merchant can’t show us a signed sales receipt or if authorization wasn’t given, typically we’ll do a charge back,” McCoy said. “The merchant will have to eat that loss. That’s why it’s so vital that they double check customer information.

“The chances of ever recovering a lost debit or credit card are slim and none, but contacting your bank immediately can keep a situation from getting a lot worse.”

Originally from Memphis, McCoy spent six years in the U.S. Navy guarding nuclear weapons and sensitive information like codes for Tomahawk missiles, then another 1.5 years working for Wells Fargo before joining Arvest Bank Group Inc.

He’s one of about 35 risk management employees Arvest has companywide.

“We do a number of in-house things at Arvest,” Mason said. “We monitor certain transactions and have surveillance cameras that we use to protect ourselves and customers. Typically the first thing we do if there’s a question is immediately close an account and start gathering information. We will also get the police involved.

“In the case of credit cards, Visa is our provider and we can also start charge-back procedures with them. Visa takes over from there.”

McCoy said the majority of most banks’ fraud losses from stolen cards are incurred through gas stations and quick shops, where thieves can pop a credit or debit card in a gas pump and complete a transaction fairly easily. The pumps are convenient, but not all of them ask for Personal Identification Number codes which can prevent theft.

Convenience, McCoy said, might make for hassle-free transactions but it can also contribute to security breeches. Sometimes protective obstacles are for the best.

“At Springdale Bank & Trust, we want to be hassle free for our customers,” McCoy said. “But when we ask for a little more information before granting certain access, we’re doing it to protect our customers, too. We want them to understand we’re not playing hard ball.

“We’re looking after their money.”

Commercial accounts can be even more sensitive, since a major theft can interfere with regular business operations. One local company had its checkbook stolen last year and over one weekend, more than $70,000 was cashed by a group of forgers.

“If you’re a commercial customer of a bank, any bank, you need to keep your banking information locked up,” McCoy said. “It’s also important to have more than one authorized signer if possible, that way when banks check for the authorized signatures it’s harder to have something slip through.”

McCoy said PIN stands for “personal ID number” not “community ID number,” so customers should memorize PINs and never write them on their debit cards. He said many times customers will call the bank after they’ve already given their accounting and routing numbers out over the phone or Internet.

He said that should never happen unless the customer is familiar with the entity they’re dealing with. Account and routing numbers may be used to create automatic withdrawals.