Credit Card Fraud: Getting it Right

With data breaches reported nearly daily, it is no stretch to think pretty much everyone’s card information has been compromised at some point. Criminals typically use only a fraction of stolen card information, but this week, I was one of the (un)lucky ones to have my card compromised and used.

The experience with my bank was, however, a very well-handled card fraud event that deserves to be broken down to show why it was a success. My primary banking relationship has been with Wells Fargo for over 15 years (though I do have relationships with five other institutions). The bank’s preventative actions and aftercare experience ensure I will continue to be a customer. Aite Group research shows that, in the U.S., 6% of consumers will switch institutions after a fraud event and 30% will move the card to back of wallet, representing lost revenue opportunities.

Here is what went very right in my experience and why my confidence with my bank is improved:

  • The fraudulent transactions were identified early—none of the fraudulent charges were posted, and the card was blocked.
  • Transaction monitoring and breach lists did their jobs. The agent was able to confirm the card was compromised in a breach.
  • A replacement card was shipped overnight via FedEx and arrived on time. While this doesn’t change the fact that I needed to fix a lot of subscriptions, the quick turnaround certainly helped. I have multiple payment options, but that is not true for many people.
  • I received a phone call from Wells Fargo regarding potential fraud on the card. I need to refresh my SMS/app notification preferences, but these have also worked in the past with past high-risk transactions. Diamond ring, big-screen TV—certainly out-of-pattern and high-risk transactions for me.
  • The customer service agent was well-trained and well-informed. Being in the fraud-prevention business, I asked some tough questions, and the agent was adept at providing answers while staying within policy guidelines.

Each of these things—transaction monitoring, breach list monitoring, and excellent customer service—all combined to make the experience as smooth as possible. One of the greatest successes is that no fraudulent transactions were authorized—Wells Fargo caught the first one and suspended the card. I found this especially impressive because all the charges were less than US$200 and online, and I do a lot of online shopping at that price point.

To me this is an example of people, processes, and technology working together to produce a solid result that improves customer retention and customer experience, reduces fraud losses and operational expenses associated with chargebacks, and demonstrates the Wells Fargo brand promise that security is important and dealt with proactively.

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