By any measure, e-commerce is a fast-growing industry. In fact,Forbes.com reported that the U.S. e-commerce sector is growing atmore than 14% annually, handily eclipsing economic growth in thiscountry. And while Americans are increasingly shopping online,fraud related to these transactions is also on the rise.

Consider a recent Javelin Strategy & Research studypublished by CIO-Today.com, which predicted online fraud in theU.S. will reach $19 billion by 2018. This estimate is almost doublethe $10 billion figure the firm reported for 2014.

“Many experts in the industry are speculating that thenationwide migration to EMV credit and debit cards is acceleratingthis alarming trend in online fraud,” said Amy MacMullen, seniorproduct manager for CO-OP Financial Services. “The theory is thatbecause fraudsters can no longer easily create counterfeit cards,they will shift their focus instead to card-not-presenttransactions. Whether or not this is the case, the fact remainsthat consumers are increasingly purchasing online, a dynamic thatpresents security challenges for credit unions and theirmembers.”

There's No Substitute for a Great Watchdog

In the fight against online card fraud, MacMullen emphasizes theimportant role trained analysts play.

“It is imperative that a credit union has access to experts infraud detection,” she said. “Choosing a service provider withdeep resources in this area can dramatically improveoutcomes.”

MacMullen noted that when supported by the most advancedtechnologies, trained analysts can immediately respond to the firstsigns of fraud and mitigate the situation, often before the creditunion and its members are even aware of it.

“Data analytics can help analysts quickly zero in on the sourceof a compromise, and fraud-detection systems can provide them witha real-time score to help determine how risky a transaction is,”she said. “Other tools are available that can categorically blocktransactions that meet a specific criteria, such as thoseoriginating from countries or regions known to be hotbeds of fraud.When overseen by experienced analysts, these tools can make atremendous difference in safeguarding member card data.”

Placing Security in the Hands of Members

While support from fraud-detection experts and systems iscritical, there are several measures credit union members can takethemselves to reduce their risk online.

“New e-commerce technologies such as Visa Checkout andMasterCard MasterPass are very effective at protectingcard-not-present transactions,” MacMullen said. “This is becauseonce an account has been set up, billing and card informationresides only at these networks. The user never has to type inaccount information again to complete transactions, so fraudstershave absolutely no access to that data.”

She also advised members with mobile devices to usecomplex passwords for all accounts and to set up fingerprintauthentication on devices if available. However, even with theseadded layers of protection, MacMullen noted that consumers shouldalways take precautions.

“Make sure your members know not to provide personal informationto any unsolicited requests or to social media sites,” she said.“And when they are ready to place an order, advise them to type inthe website URL instead of clicking on emailed links or allowingthe browser to direct them.”

According to MacMullen, it is also important to ensure that amerchant's URL starts with “https” instead of “http” as the “s”indicates a secure site. A lock icon at the bottom of the browserprovides further assurance that the site is secure.

“The rest comes down to common sense,” she said. “Members shouldbe reminded to shop only with online merchants they trust, to varytheir passwords and to change passwords frequently. And just asthey don't open their doors to strangers, they shouldn't openmessages from unknown senders.”

MacMullen continued, “Have your members check their accountactivity routinely, and introduce them to new apps for cardcontrols and alerts that can be set to approve online transactionsonly when the members themselves are making the transaction, oralert them in real time when a transaction occurs. As a creditunion, you are in a great position to educate members aboutsecurity and help them safely enjoy all the speed and convenienceof online shopping.”

Do more to protect your credit union and members by readingCO-OP's Security eBook.