Donna Alton* was scrupulous about maintaining her family’s rainy day fund of $150,000 in a home equity line of credit at her credit union.
So she was stunned when she discovered that someone had cleaned out the account in three separate electronic wire transfers. When her credit union refused to replace the funds because they believed the transfers were legitimate, Alton was at a loss.
“There were a lot of tears,” she said, “and many sleepless nights.”
Alton is among a growing number of victims of wire transfer fraud: Criminals use their victims’ personal information to initiate and execute the electronic transfer of funds. In 2011, half of all consumer complaints** to the Federal Trade Commission involved wire transfer as a method of payment, according to the FTC’s Consumer Sentinel Data Book. And losses totaled more than $442 million.
Wire transfer fraud is a perfect way for identity thieves to pilfer money from banks and credit unions. Criminals have found creative ways to hoodwink financial institutions into believing they’re real customers—and make off with big bucks.
In Alton’s case, thieves not only found a way to access her account and request the transfer, they also rerouted all incoming calls from her home phone to another line. When the credit union called Alton’s home to authorize the transfers, the calls went to the crooks instead, and they verified the requests. Read more about account takeover in this Q&A with our expert.
Alton filed a report at her local police department. “They looked at me like, ‘Lady, you’re watching too many Jack Bauers,’ ” she said, referring to the main character in the TV series 24 about a counterterrorist unit agent.
Fortunately, Alton’s homeowners insurance policy with Chubb Group of Insurance Companies offered free identity management services from Identity Theft 911. “You always think they fluff up your policy with services like that,” said Alton, who worked in insurance for 15 years. “You never think you’re going to have to use it. But it was a godsend.”
Alton was impressed with the seamless transfer from Chubb’s claim department to Identity Theft 911’s Fraud Resolution Center. From there, her case was given to Maria Valenzuela, a fraud investigator, who helped Alton until her case was resolved.
Valenzuela took steps to protect Alton’s other accounts and credit by placing a fraud alert on the Altons’ credit reports. Alerts let potential creditors know that you may be—or are at risk of being—an identity theft victim.
And over a period of several months, she helped the Altons with a lot of red tape in order to restore their funds and good credit, including the:
• coordination of letters, complaints and affidavits to law enforcement, regulatory agencies and the couple’s cable company and credit union
• communication with law enforcement and the couple’s credit union, which had grown tense
• removal of the unpaid home equity line of credit from the Altons’ credit report so they could secure a new line of credit.
Because this case of wire transfer fraud included such a large sum of money transferred in three different amounts to three different bank accounts (and then to a final account the thieves had set up), it was difficult to navigate and manage.
“Maria completely held my hand and walked me through the whole process,” Alton said. “She told me, ‘This is what you have to do, this is what you have to say, this is who you have to call.’ She was very thorough and compassionate.”
Alton was so pleased with Valenzuela’s work that she contacted her insurer, Chubb, to thank them for gifting Identity Theft 911’s services in her policy.
Now a year later, Alton and her family have recovered their savings and opened a new home equity line of credit. Although Alton still gets angry when she thinks about the ordeal, she said it opened her eyes.
“I learned so much from the experience,” Alton said. “I learned to really vet my bank and make sure the proper security protocols are in place. Maria taught me how to be more aware of protecting my privacy. And I learned that insurance is one of those things you don’t think you’re going to need but when you need it, you don’t want exclusions.”
* Name has been changed to protect customer’s privacy.
** The FTC reports that these numbers include figures from MoneyGram International and Western Union Money Transfer.
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