Coronavirus Intensifies Cyber Crime Threats to Credit Unions, Members

Republished from CU Times dated April 3, 2020. By James McCabe.

In a time when security threats are compounding due to the crisis, CUs should show members how they're protecting them.

In December 2019, an article in CPO Marketing acknowledged that the FBI had issued a warning to the auto industry about being a target for cyberattacks. The U.S. automotive industry has become a target for cybercriminals because of the vast amount of personal data it contains. It is rare when you hear the FBI single out a particular industry followed with substantial warnings like this one, which says, "Automotive companies need to develop proactive defensive security measures to deal with all of the risks highlighted by the FBI warning." And ditto for the credit unions who work with auto dealers to be on guard and extend protections to their members.

Although this FBI warning went out to the auto industry, it affects more than just dealers. Credit unions who offer auto loans and members who receive financing are also at risk. The article mentioned above, clearly states that “In particular, when an enterprise shares data or partners with other organizations, it needs to be aware not only of the risk directly posed to its systems but the risk to its partners’ systems as well.” The financial data of members is a part of the automotive industry’s growing risks, and members should be aware so that they can ask the auto dealers how their data is protected.

Members also need to understand that identity theft is not just happening on debit or credit card transactions. Criminals are using stolen data to go beyond the typical financial transactions to pull off much more significant crimes. For example, cyber thieves who use stolen identities for medical fraud and to make big-ticket purchases can create nightmares and years of torment for the victims.

Compounding this specific attack on the auto industry and indirectly, your credit union, the COVID-19 pandemic has made the auto industry and other businesses even more susceptible to attacks, establishing an entirely new dynamic to the threats that already existed. Cyber thieves are using this time as an opportunity to attack while dealerships and other companies are hyper-focused on managing the effects of the coronavirus. As a result, another FBI warning has emerged about coronavirus scams and the need for vigilance and awareness as these attacks increase.

The current state of the world and anticipated new attacks are hitting very close to home for the credit union world, and it warrants a serious new assessment of your credit unions' overall cybersecurity preparedness. There is a new magnitude of fear and distraction within consumers (your members), and unfortunately, this creates the perfect feeding ground for criminals to attack.

Also, imagine the level of criminal activity that will happen when millions of Americans are sent government funds as part of the coronavirus stimulus package. It won’t take the ingenious criminals long to find a way to intercept funds or deceive recipients in some calculated scheme.

All of this allows credit unions to be purposeful in reacting to the FBI warnings and to demonstrate their commitment to looking after their members' well-being. Many credit unions are putting into place a strategy of ID theft protection that provides a heightened level of protection for the whole credit union and its members in a manner that also increases member engagement.

In closing, it is another fantastic opportunity for credit unions to show how they care for their members beyond the walls of the institution and how they differentiate themselves in the financial industry. Bring your members solutions that demonstrate the understanding of their growing risks and offer some expanded education & awareness. They may not immediately connect the FBI’s warnings to the auto industry or about the COVID-19 pandemic to threats that pertain to them, so a credit union centric reminder could be just what members might need. And giving the members a powerful, positive message in this time of fear and trepidation will solidify your relationship with them during the worst of times. Thus, making way for long-term success when the good times return.