A layered approach to fraud victim support
1. Prevention through education and technology
Preventing fraud begins with awareness. Banks and credit unions can help clients identify red flags by offering regular educational materials across digital and in-person channels. Topics include the creation of secure passwords, the identification of phishing attempts, and safe usage of peer-to-peer payment apps.
Technology also plays a pivotal role in prevention. Sophisticated fraud detection tools incorporating artificial intelligence and behavioral analytics can monitor suspicious activity in real time. Institutions can also empower their clients with biometric login, multi-factor authentication, and real-time fraud alerts.
- Helping clients create a response plan
Helping clients prepare a response plan before fraud occurs can reduce confusion and stress if the worst happens. Encourage clients to keep a written checklist that includes how to report fraud to their financial institutions, contact information for the FTC and FBI, and steps for freezing credit with the major bureaus. The plan should also cover resetting login credentials and enabling fraud alerts. Reviewing this plan regularly gives clients confidence that they know what to do and who to call. It is a simple way to support a long-term client relationship.
- Responding with clarity and compassion
A fast and empathetic response is critical following a fraud incident. Banks and credit unions should have clear procedures in place to support victim response plans, including measures around:
- Freezing or closing affected accounts
- Reissuing account credentials and payment cards
- Assisting with dispute processes and documentation
- Communicating directly with law enforcement when appropriate
Empowering front-line employees to handle these cases with care can help ease client anxiety and reestablish trust during a particularly vulnerable time.
- Supporting financial recovery
While banks and credit unions often must reimburse clients for unauthorized transactions, many fraud cases involve victims being tricked into authorizing payments. In these situations, reimbursement is not always guaranteed. Still, financial institutions can support victims with the following meaningful actions:
- Assist with regulatory reporting: Help victims file official complaints with the FTC, the FBI, or Consumer Financial Protection Bureau (CFPB). These reports establish a record of the incident and contribute to broader fraud tracking efforts.
- Work with law enforcement and other financial institutions: Cooperate with authorities and peer institutions to trace stolen funds and flag suspicious accounts. Swift action can help contain damage and may lead to partial recovery.
- Provide recovery resources: Refer victims to identity theft protection services, legal aid, or nonprofit support organizations. These resources can help clients manage credit impacts and protect against future fraud.
Even when full financial recovery is impossible, these steps demonstrate a commitment to care and accountability. Institutions prioritizing fraud victim support during recovery reinforce trust and deepen client relationships.
Sustained support beyond the incident
Helping a client through the immediate fallout of fraud is the first step. Ongoing protection is key to rebuilding confidence. Financial institutions can offer continued support through:
- Identity theft monitoring
- Credit and account activity alerts
- Help with placing credit freezes
- Referrals to advocacy groups for seniors or other vulnerable individuals
Staying engaged after the crisis helps banks and credit unions show they are not just financial service providers but also long-term partners in their clients’ security and peace of mind.
