Velera Defines Consumer-Engaged Fraud in an Effort to Solve One of the Credit Union Industry’s Biggest Threats
St. Petersburg, Fla. (March 3, 2025) – Velera – formerly PSCU/Co-op Solutions, the nation’s premier payments credit union service organization (CUSO) and an integrated financial technology solutions provider – today released a guide on consumer-engaged fraud to educate credit unions on the many classifications of one of the industry’s biggest drivers of fraud losses. Through this guide, Velera is helping credit unions understand consumer-engaged fraud patterns and their impact on financial institutions and merchants.
Velera identified the magnitude of consumer-engaged fraud through its Risk Solutions Collective Advisory, a group of credit union industry executives who partner with Velera on risk solutions by providing invaluable insight into the frontlines of day-to-day fraud operations from their positions within their respective credit unions. Together, in partnership with this advisory group, Velera is aiming to further educate the industry on consumer-engaged fraud and provide resources to help detect and combat these scams with a standardized approach to case management.
“Consumer-engaged fraud is among the fastest growing and most prevalent industry fraud challenges that credit unions are facing today, due in large part to its variety of different classifications – which make it difficult to define, identify and address,” said Nicole Reyes, vice president of Risk Engagement, Velera. “Through our Risk Solutions Collective Advisory, Velera has been able to bring together some of the best minds in the industry to outline and detail the classifications and sub-classifications of consumer-engaged fraud so that we, as an industry, can better detect these scams and defend against them, ultimately protecting credit union assets while enhancing the member experience.”
Velera outlined two types of consumer-engaged fraud in its guide: misuse and persuaded. Misuse occurs when a transaction or engagement is made or initiated without outside influence by someone who does not have authorization to use an account and is subsequently reported as fraud. Persuaded is a transaction or engagement that is made or initiated with outside influence and allowed to be completed due to an authorized user of an account engaging with a third party that influences the completion of a transaction, which is then reported as fraud. Velera’s classification guide further defines both through sub-classifications that will enable credit unions to better understand the patterns and items for which to monitor behind the various fraud schemes.
“Consumer-engaged fraud remains a widespread issue, often linked to financial challenges consumers experience like inflation, high credit card interest rates, and other economic factors,” said Jeff Morris, vice president of Card Services, Nusenda Credit Union (Albuquerque, N.M.). “The consumer-engaged fraud guide enables us to more effectively tackle these challenges by standardizing our approach to detect and combat this type of fraud and ultimately protect members’ finances.”
Velera and its Risk Solutions Advisory Committees will remain on the forefront of identifying risks facing the industry, sharing its findings and solutions for credit unions to put to use. Velera’s consumer-engaged fraud classification guide is available here.
About Velera
Velera, formerly PSCU/Co-op Solutions, is the nation’s premier payments credit union service organization (CUSO) and an integrated financial technology solutions provider. With over four decades of industry experience and a commitment to service excellence and innovation, the company serves more than 4,000 financial institutions throughout North America, operating with velocity to help its clients keep pace with the rapid momentum of change and fuel growth in the new era of financial services. Velera leverages its expertise and resources on behalf of credit unions and their members, offering an end-to-end product portfolio that includes payment processing, fraud and risk management, data and analytics, digital banking, instant payments, strategic consulting, collections, ATM and POS networks, shared branching and 24/7/365 member support via its contact centers. For more information, visit velera.com.
