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Text scams other fraud reported by CUs

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MADISON, Wis. (3/4/11)--Credit unions in several states are reporting recent text, e-mail, and telephone scams urging consumers to divulge their account numbers. Also, two credit unions reported counterfeit checks, CUNA Mutual recently alerted credit unions about unauthorized wire transfers through the Bredolab Trojan malware, and one credit union reissued debit and credit cards after a theft at a gas station. Among the reports:
* In Pennsylvania, someone posing as Beaver Valley FCU, Beaver Falls, is texting people and asking for personal debit and credit card information (Associated Press Newswires March 3). Police began receiving calls about the scam Tuesday and called the numbers given in the text message. One goes to North Carolina and another to Massachusetts. Two people fell for the scam and gave account information but no fraudulent transactions have occurred yet. On Thursday New Brighton police reported six such calls. Scammers are contacting people with cell phone numbers in the 724 area code ( March 3). * ARC FCU in Altoona, Pa., told the Pennsylvania Credit Union Association recently that members received automated phone messages advising them of a problem with their debit/credit cards and instructing them to call in and enter their card number. Caller ID screens show the calls came from 1402, a number that is not associated with the credit union (Life is a Highway Jan. 31). * In North Carolina, a text message purporting to be from Tarboro-based Telco CU informs recipients their account has been suspended and asks them to call a telephone number to verify account information. Several people who do not have Telco accounts contacted the Asheville Police Department after receiving the text (Asheville Citizen-Times March 3). * Similar e-mail scams claiming something is wrong with an account are targeting Mobiloil CU members and nonmembers in Beaumont, Texas, said the Beaumont Police Department (Beaumont Enterprise Feb. 9). * West Community CU, O Fallon, Mo., cancelled and reissued about 250 cards whose numbers were compromised when a credit card machine was stolen from a Mobil station in St. Louis. ( Feb. 21). * Security Service FCU, San Antonio, said that in January hundreds of people received automated calls from a 1-888 number about deactivated accounts and asking for account numbers ( Jan. 31). The messages claim recipients' cards have been blocked and they must enter their account number and personal identification number to reactivate them. An example: "(888-891-2538) Hello. Call us now at 817-350-4570. Security Service FCU." Neither number belongs to the credit union.
Two credit unions--in Kansas and Pennsylvania--reported counterfeit checks circulating with their names. Lenexa, Kan.-based CommunityAmerica CU's name is used on counterfeit cashier's checks, said an alert from the Federal Deposit Insurance Corp. CommunityAmerica does not issue cashier's checks; it issues official checks. The bogus checks include a routing number, 011007092, assigned to Boston (Mass.) Safe Deposit & Trust Co. The credit union's official checks are through Moneygram Payment Systems Inc. and use an account held in the Boston Safe Deposit & Trust Co. The fake items display a security feature statement embedded within darkened top and bottom borders, and the word "CASHIER'S CHECK" in the top center. Authentic checks have a blue cubed background,dark blue top border, and a security feature statement centered above the bottom order. Seven arrows precede the numeric dollar amount. Also, Allegheny-Ludlum Brackenridge FCU in Brackenridge, Pa., said fraudulent checks with its name, address and ABA number are in circulation and use an account number from a closed account (Life is a Highway March 3). The check--from GALA GLOBAL in Andover, Mass.--is for $980 and is enclosed in a letter about GALA's Member Pulse Survey 2011 for a Walmart evaluation exercise. It asks the recipient to deposit or cash the check "preferably at your bank and NOT at any Walmart location (so the employees at Walmart won't be tipped off)." And, finally, CUNA Mutual Group's Credit Union Protection Resource Center last month told credit unions that the Internet Crime Complaint Center (IC3) recently reported more than $150,000 stolen from a U.S. business through unauthorized wire transfers when a computer was infected with the Bredolab Trojan. The method of delivering the Trojan was different from cases using the Zeus Trojan in a money mule scam, according to the New Jersey Credit Union League's The Daily Exchange (Feb. 3).. The Zeus Trojan was delivered via phishing e-mails sent to key employees at a business. Bredolab is embedded in e-mails received by the business in response to a job posting the business placed on an employment website. Bredolab compromises the business' online banking login credentials, which cyber thieves use to initiate wire transfers--one to the Ukraine and two within the U.S. Credit unions and other financial institutions will not use these methods to contact a member about an account, and will never solicit account information over the phone, e-mail, or through text.

Online crime at second highest in decade

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FAIRMONT, W.Va. (3/4/11)--Just how pervasive has Internet crime become? In 2010, the Internet Crime Complaint Center (IC3) received 303,809 complaints--the second-highest total in IC3's 10-year history and an average of 25,317 complaints per month. IC3, a repository for victim complaints, is a partnership between the Federal Bureau of Investigation (FBI) and the National White Collar Crime Center (NW3C). It has received more than two million Internet crime complaints since it was established in 2000. The three most common complaints:
* Nondelivery of payment or merchandise (14.4% of complaints); * Scams using the FBI's name (13.2%); and * Identity theft (9.8%).
Others included: computer crimes, 9.1%; miscellaneous fraud, 8.6%; advance fee fraud, 7.6%; spam, 6.9%; auction fraud, 5.9%; credit card fraud, 5.3%; and overpayment fraud, 5.3%. Of those with dollar losses reported, 21.1% related to non-delivery of payment or merchandise; 16.6% were identity theft, 10.1% were auction fraud, and 9.3% were credit card fraud. This represents a shift, said the report. Historically, auction fraud has been the leading complaint by victims, accounting for 71.2% of referrals in 2004. But in 2010, auction fraud represented slightly more than 10% of the complaints. "This demonstrates the growing diversification of crimes related to the Internet," said IC3's 2010 Annual Report. "The steady decline in the total number of complaints and referrals of auction fraud over the last several years has altered the top complaint categories." The cause is unknown, said the report, which added a possible explanation could be that "complaint levels are normalizing as businesses and consumers discover and implement ways to make previously uncharted areas of online commerce safe and more reliable." Online crime affected all demographic groups. Age groups and gender gaps were narrower. Most complainants were in the U.S., male, between 40 and 59 years old, and a resident of California, Florida, Texas or New York. Most foreign complainants were from Canada, the United Kingdom, Australia or India. Men reported greater dollar losses than women (at a ratio of $1.25 to $1). Individuals 60 and older reported higher median amounts of losses than other age groups, said the report.

Belvoir FCU launches live chat support

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WOODBRIDGE, Va. (3/4/11)--Belvoir FCU is launching a real-time, live chat support for its members, announced the Woodbridge, Va.-based credit union Thursday. The Live Chat software, powered by SightMax, allows the more than $269 million asset credit union to offer immediate online support for its members with chat functionality, language translation and customizable capabilities. By implementing the feature on its website, Belvoir Federal can service members across the world with more immediacy, and answer member and non-member questions quickly and efficiently, said the credit union. SightMax is an entity of SmartMax, which provides live chat and other products for e-commerce services and marketing strategies. It operates in a variety of industries.

Ten inducted to CU House Hall of Leaders

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WASHINGTON (3/4/11)--Ten credit union leaders who have made a significant impact on the credit union movement at the local, state or national level were inducted into the Credit Union House 2011 Hall of Leaders this week. Inductees are:
* Harold Allen, Nebraska. Allen has dedicated 30 years to advancing the credit union movement. He has served on the University of Nebraska FCU's board of directors and the Nebraska Credit Union League board. He has been an active volunteer on behalf of credit unions in legislative advocacy efforts on the state and national level. * D.S. "Scotty" Broome, Mississippi. Broome is the former president/CEO of the $1.86 billion asset Keesler, FCU, Biloxi, Miss. He retired in June 2010 after 34 years of service and was active on the legislative advocacy front on behalf of the military, veterans and the Defense Credit Union Council. * Raymond Brunner, Pennsylvania. Brunner, president/CEO of WEST-AIRCOMM FCU, Beaver, Pa., is currently chairman of the board of the Pennsylvania Credit Union Association (PCUA) . He has served on the PCUA board since 1999. He is responsible for leadership in developing a new board governance structure for PCUA. * James Bryan, Texas. Bryan is former president of Texans CU from 1975 to 2003, and served as chairman of the boards of the Texas Credit Union League, Southwest Corporate FCU and CUNA Mutual Group, as well as a board member of the Credit Union National Association (CUNA). He also served on the Federal Reserve Bank's Thrift Institutions Advisory Council and the Filene Research Institute Research Council. He was named the league's 2002 Credit Union Professional of the Year and inducted in 2004 into the Texas Credit Union Hall of Fame. * William Eckhardt, Alaska. President/CEO of Alaska USA FCU since 1979 after joining the credit union staff in 1971, Eckhardt has served on the CUNA Mutual Board of Directors since July 2005, is past chairman and current board member of the Alaska Credit Union League, and is a past board member of CUNA . He is also chairman of Alaska USA Insurance Agency and Alaska USA Trust Co., and was recipient of the league's Horace Bremner award twice for his contributions to the Alaska movement. * John Fiore, Illinois. Fiore, CEO of Motorola Employees CU, Schaumburg, Ill., is recognized for more than 40 years' devotion to the movement. He has served as an Illinois Credit Union League director since 1989, a board member of the Illinois Credit Union Foundation since 1987, a past board member of CUNA and the National Credit Union Foundation. He also has served on the board of the Illinois Credit Union Political Action Council and as a trustee of the Credit Union Legislative Action Council. * Gene Hensley (posthumously), Tennessee. Hensley, who died Feb. 19, 2010, served as president/CEO of Appalachian Community FCU (formerly Mead Kingsport CU), Kingsport, Tenn., for 31 years. He served on the board of directors of the Tennessee Credit Union League, as board treasurer for Mutual Guaranty Corp., and was a board member of Volunteer Corporate CU. He also was president of the Northeast Tennessee Chapter of the league. * John Murphy, Maine. Murphy, who is the long-time president of the Maine Credit Union League and its subsidiary, Synergent, has provided more than 32 years' service with the credit union movement at all levels, including statewide and national. * Robert Walls, Delaware. Walls was president of the Delaware Credit Union League from 1992 until 2005. He is a member of CUNA's board of directors. Walls served as a member of the site selection committee for Credit Union House and served on its board of directors and as chairman. He is active in the American Association of Credit Union Leagues and was instrumental in establishing and served as chairman of the Mid-Atlantic Regional Service Corp., a multi-league service corporation. * Jim Williams, Texas. Williams was has worked with a number of credit unions as manager or president since 1960, including Texas Crossroads FCU, Government Employees CU, Texas Central CU, and Amarillo Air Force Base CU. Currently he is consultant to Texas Dow Employees CU. A former chairman of the Texas Credit Union League board, he was inducted into the Texas Credit Union Hall of Fame in 1999. Williams was appointed by the governor to the Texas Credit Union Commission, which he served from 1971 to 1979. He also was a national director and board chairman of CUNA and served as CUNA's president from 1979 to 1986.
The Credit Union House Hall of Leaders was launched in 2008. The names of inductees and their sponsoring organizations will be prominently displayed at Credit Union House.

WOCCU seeks pure dead brilliant presentations

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MADISON, Wis. (3/4/11)--“Pure dead brilliant” is what the Scots say when referring to something extraordinarily special. That is what the World Council of Credit Unions (WOCCU) is searching for--special educational presentations for the 2011 World Credit Union Conference, July 24-27 in Glasgow, Scotland. Those who have an idea for an educational presentation should submit their presentations online to be considered for the credit union movement’s only global event. Use the link. The deadline for submissions is March 31. This year’s educational tracks will focus on four themes:
* Moving from philosophy to service; * Defining strategy and leadership; * Developing credit union movements; and * Raising finance and operational standards.
For more information, use the link.

Corporates consolidation topic of 10 town hall meetings

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PLANO, Texas and DULUTH, Ga. (3/4/11)--Executives of Southwest Bridge Corporate FCU in Plano, Texas, will host 10 town hall meetings statewide this month. The purpose of the meetings is to provide member credit unions another opportunity to obtain information about the proposed consolidation of Southwest Bridge Corporate and Georgia Corporate, Duluth, Ga. “The proposed business plan is based on less capital, less risk and uninterrupted delivery of products and services to our member credit unions,” said Dianne Addington, CEO of Southwest Bridge (LoneStar Leaguer March 3). “Our goal for these meetings is to communicate why this business plan was selected, what the new corporate would look like, why it would carry less risk, and how much capital credit unions would need to invest,” she added. “We want credit unions to understand the plan completely and get all their questions answered.” Southwest Bridge is conducting 26 town hall meetings in eight states. The meetings are part of ongoing member communication efforts regarding the future of Southwest Bridge Corporate. Some information will be repeated from previous webinars conducted by the corporate, but new information will be presented. Three webinars were conducted in December and January.

Nine indicted in St. Paul Croatian FCU collapse

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CLEVELAND (3/4/11)--A federal grand jury in Cleveland indicted nine people Wednesday on fraud charges related to the collapse of St. Paul Croatian FCU in Eastlake, Ohio, last April. Those charged include: Anthony Raguz, 51, of Mentor; Koljo Nikolovski, 48, of Eastlake; Rose Ann Nikolovski, 48, of Eastlake; Marko Nikoli, 33, of Eastlake; John Cendol Jr., 48, of Kirtland; Ruth Cendol, 55, of Kirtland; Daniel Kocher, 72, of Euclid; Edward Watral, 37, of Creston; and Jennifer Cerjan, 33, of Orrville (Fox March 2). A 26-count indictment was filed against these individuals who federal prosecutors said were responsible for the fraud that forced the National Credit Union Administration (NCUA) to liquidate what remained of the credit union’s assets, according to the Justice Department. Raguz, who was chief operating officer at the credit union, allegedly issued more than 1,000 fraudulent loans totaling more than $70 million to about 300 account holders from 2000 to April 2010, according to the indictment, Fox 8 said. Prosecutors allege that Koljo Nikolovski was one of the primary recipients of the fraudulent loans, allegedly receiving several loans from the credit union totaling $2.9 million during a two-year period from 2003 to 2005, Fox 8 said. The NCUA Office of the Inspector General (IG) revealed in October that the fraudulent loans put the credit union into liquidation, with losses to the National Credit Union Share Insurance Fund totaling $170 million (News Now Oct. 14). The IG report also noted that Raguz “manipulated loan records and masked the suspected loan fraud by constantly refinancing certain loans or making advance payment on those loans.” St. Paul Croatian FCU was placed into conservatorship April 23 and closed May 1. At the time of its closing, it held $238.8 million in funds from 5,400 members (News Now May 4).

CU System briefs (03/03/2011)

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* HARRISBURG, Pa. (3/4/11)--A homeless man turned in $1,440 in cash he found after Robert Stauffer, a lawyer who does work for APEX Community FCU, Pottstown, Pa., lost a credit union envelope stuffed with bills last week while conducting business in the area. According to the Pennsylvania Credit Union Association (PCUA), the man found the cash and flagged down a patrolman to turn it over. Stauffer, who collected the money from police Feb. 24, asked them to help him contact the Good Samaritan to "reciprocate his generosity." Dave Cocci, CEO of APEX Community, told PCUA the credit union and Stauffer plan to make a donation to the homeless shelter (Life is a Highway March 2) … * BEAVER FALLS, Pa. (3/4/11)--A Coraopolis, Pa., woman was indicted Monday by a federal grand jury on 16 counts of bank embezzlement and falsifying records while she was head teller at West-Aircomm FCU. Shirley A. Howl, 55, is accused of embezzling about $400,000 between August 2007 and November 2009 by taking money from three cash machines in the credit union's Beaver branch and making ledger entries before the machines were audited to make it appear funds were transferred to the vault. Then she allegedly "transferred" the money back to the machine so the vault's record would match the amount in the vault, said court records (Pittsburgh Tribune-Review and Pittsburgh Post-Gazette March 2) … * PLEASANTON, Calif. (3/4/11)--Patelco CU, a $3.6 billion asset credit union formerly based in San Francisco, has moved its headquarters to Pleasanton, Calif., in the East Bay area, to be closer to more members and to make it easier to recruit employees. The move occurred at the end of February. Patelco has rented 56,000 square feet in its office building. Roughly 40% of the credit union's California members reside in the East Bay area, the credit union said. It has 41 branches and 270,000 members and 540 employees (Contra Costa Times March 2) … * RIVERSIDE, Calif. (3/4/11)--Altura CU announced that Rosario
Click to view larger image Click for larger view
Inzinga, shown here, a member from Riverside, Calif., won $5,000 just by using her Altura Visa Debit Card. Members who used the card to make a purchase between Jan. 1 and Feb. 10 were entered to win $5,000 in the "Cha-Ching" Visa Debit Card promotion. They also had to have a checking account and register the card through Altura's website to participate. A member since 2005, Inzinga, a mother of two, said the money was a welcome surprise. The credit union wanted members to know that the card "is not just a tool for accessing their accounts or getting cash from an ATM," said Jennifer Binkley, Altura chief operating officer. The campaign "was designed to show members how easy it is to use" for everyday purchases, she added. (Photo provided by Altura CU) …