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Interview with Merrill Halpern, AVP Card Services, the

United Nations Federal Credit Union (UNFCU)

The United Nations members on how to best
Federal Credit Union protect their cards and make
(UNFCU) is familiar to security a priority. We like
most people working in other international banks
the United Nations and therefore, experience fraud
also in the different UN because our payment cards are
worldwide.
agencies used all over the world.
Recently, UNFCU made
the headlines in the You have probably heard that
United States because thieves use "skimming", a
they were the first device to copy the number of a
financial institution to credit card. If there is skim-
introduce credit cards ming taking place in New
with a personal identi- York, for instance, basically
fication number (PIN) we and other financial institu-
code and a chip. You may tions suffer from it. As a result,
think that this is nothing we said to ourselves that if we
to be proud of, because in were to implement a PIN card,
Europe we have used this not only could we increase
system for a long time. acceptance from our members
However, in the United and encourage them to use our
States it is just starting to credit cards, but we would also
make a difference. The be able to bolster members'
key person is Merrill security and cut down on
Halpern, a well-known accepted outside the United of these unattended machines fraud, because more cards
figure in financial circles. States, and particularly in where they required a chip and would be subject to this
He simply loves working Europe" -- where we have PIN code." That's how it additional PIN authorization.
for UNFCU because it's thousands of members. started. We had already
such a unique place to observed that, even though we We have known for some time
work. It's like a mini-UN, In Europe, for security reasons have provided a great credit that we wanted to do this and
meeting people from all they need to see a chip with a card with many special we had approached many
over the world -- and PIN code. In the United States features, why were people not commercial companies over
making the international it's normal to present a card making more use of it? It is all recent years. We were told,
staff happy and satisfied with a magnetic stripe about convenience. however: "It sounds great and
through the services (depending on the merchant) we would love to work with
offered by UNFCU. We to see if the signature matches. Well, everybody carries lots of the credit union for the United
met Merrill Halpern in In Europe and in other parts of credit cards and they end up Nations, but you have far
New York. the world in particular, that using the one that works. So, if fewer card holders than mega
transaction goes online and the there is one card that I cannot international banks and your
Q: UNFCU is the first PIN entered by the card holder depend on, I'm going to use volume of transactions is far
financial institution in the is verified against the PIN the one that comes from a too low. Therefore, for these
United States to launch a encrypted in the chip to make local bank instead because it reasons we are not as compel-
credit card with a PIN sure that it corresponds. has the chip and PIN functio- led to work with you."
code. Could you tell us nality. UNFCU kept going because
why you decided to do We had members who became we needed to find a solution.
this? frustrated with small transac- By the same token, in the
tions, which they could not United States we are held back After a long search we found
The chip and PIN card functio- pay with their magnetic stripe- by the magnetic stripe authori- Gemalto. They are a leader in
nality is very widespread only credit card. For example, zation. The merchant has to payment card security and
throughout the world -- except we have heard a lot of stories check that the signature very big outside the United
in the United States. The first about the French railway corresponds and identify the States. Moreover, they were
recognition of a potential system -- particularly, paying customer. We know that there also interested in getting a foot
product gap, we needed to your fare when you want to is a lot of fraud going on in the US market.
consider came from our travel. People said: "We were worldwide and as an Furthermore, because we are a
members who told us: "I'm a travelling on the weekend and institution, like many financial nimble organization focused
credit union member. I like could not get out of the train services providers who on turning ideas into reality
your services, but there is just station to a bank. The only operate globally, we are whenever possible, they loved
one problem and that is that terminal where you could pur- exposed to it. For this reason, the idea of working with
your credit card is not always chase your rail-card was at one we regularly inform our UNFCU. So that's how it all
started!
38 3 2010 Diva

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