ELGIN, Ill. — Seeking to please auditors urging more rigorous authentication of new and current members, Corporate America Family Credit Union turned to its online banking vendor.
The result is the Red Flag Pass tools that PM Systems Corp. is now offering as part of its WebFederal3 suite of online banking products.
The Red Flag Pass monitoring system uses a back-office console and a set of validation procedures to help credit unions meet the Red Flag identity theft regulations going into effect on Nov. 1.
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The system allows prospective credit union members and credit union staff to use the same Internet-based interface to enroll safely and efficiently, the company said. New memberships are created on the host system automatically once the Red Flag Pass validations are passed.
The console also allows "granular control of alert functions," the company said, covering new members, new online bankers and address changes with "out-of-wallet" validations to ensure identities.
Also included are automated warnings of possibly fraudulent activity, with notifications sent to both members and the credit union, PM Systems said. Functions can be turned on and off as needed.
After asking for the service, Corporate America FCU (www.cafcu.com) will now be the first to deploy it.
"Not only can we use this module for our online enrollment products, this piece is also good for other things such as wire transfers and password resets," said Peter Paulson, the $527 million credit union's president and CEO.
"It's also a huge time-saver for both members and staff, while adding a layer of online protection that's not obtrusive or inconvenient," he said.
The Red Flag rules, and technology to help implement them, are the result of traditional identity validation procedures becoming obsolete as fraudsters find it easy and cheap to get believable fake driver's licenses and Social Security cards nationwide, according to the South Carolina-based company's vice president of development, Ty Fellers.
Fellers also said that PM Systems' virtual and hardware token and data encryption technologies have a negative ROI, but company managers felt they would make its clients safer, especially as Nov. 1 nears.
"We know from experience that many credit unions and their service providers will be in a state of disarray and denial right up to the deadline and beyond. By providing these features today, we can help our clients demonstrate Red Flag compliance well before that deadline," he said.
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