Financial institutions to reduce fraud associated costs

[img_assist|nid=7789|title=|desc=|link=none|align=left|width=100|height=63]More financial institutions with the help of Visa's fraud recovery process to include Plus and Interlink ATM network transactions will be able to reimburse fake fraud losses. The extension becomes effective November 1, 2008.

"Visa works to help financial institutions prevent fraud. But when a data compromise does occur, our process helps them recover by reducing some of their costs quickly and efficiently" said Michael E. Smith, head of Payment System Risk, Visa, Inc.

Introduced in October 2007 Visa's Account Data Compromise Recovery (ADCR), a tailored recovery program, was intended to improve operational performance and lower expenses connected with assigning liability and collecting reimbursement for counterfeit fraud losses and expenses incurred as a result of magnetic stripe storage compromise events. Improved ADCR process provides Visa card issuers with automatic calculation and reimbursement of compensation based on counterfeit fraud which is reported to Visa.

ADCR process will be extended to PIN-based transactions due to Plus and Interlink fraud reporting capabilities upgraded lately. At the moment ADCR process is only applying to Visa signature-authenticated transactions.

This project allows financial institutions to enjoy improved and automated back-office work. Therefore Visa card issuers can lower their administrative expenses and they will be entitled to get partial recovery of operational costs and incremental fraud losses.

"Expanding this process to include Plus and Interlink represents a significant improvement over the current recovery process for financial institutions for PIN-based transactions, which may require multiple recovery scenarios for a single compromise event if the event involves Visa-branded and Plus- or Interlink-acquired transactions," Smith noted.

"Visa is the only payment company to provide this level of efficiency and cost-savings on fraud recovery involving either signature or PIN-based transactions" said Smith.