Christopher DeAngelis is convinced that Millennials—notoriously loose with their personal information—make it much too easy for fraudsters to separate them from their money. And a very few bad apples of the Millennial sort, all too aware of this, are moving into new forms of fraud themselves befitting a generation that’s grown up digital.
But for DeAngelis, who serves as Senior Vice President, head of Global Fraud and Strategy Operations at Citi Prepaid Cards, sees the news as mostly positive. He’s attended many banking conferences where speakers extol the virtues and values of the Millennials—and encourage those in attendance to enlist more members of the coveted demographic as customers.
Still after one recent conference, he concluded that Millennials “aren’t all unicorns and rainbows. In my world, Millennials are a problem from the standpoint of both the fraudsters and the victims.”
DeAngelis, who’s prevented bank fraud his whole career, says: “Everyone is targeting Millennials for good reasons. But Millennials do create some special challenges in terms of fraud prevention. I want to call attention to that.” What are those challenges, exactly?
In his current role at Citi since 2015, DeAngelis has the privileged perch to inform and educate. Prior to Citi, he held similar roles at Chase, First Data, PayPal and Capital One. Here he speaks to us in advance of his presentation at BAI Beacon, on the timely topic of Millennials and fraud.
Q. Are Millennials more prone to bank fraud—and if so, why?
A. Definitely—and certain things make them more vulnerable than Generation X or baby boomers. They are not as interested in keeping up their financial records. I’ve seen a study indicating that more than half of Millennials don’t know how to balance a checkbook because they bank online and see no need for it. As they don’t maintain meticulous records, they’re less aware of what’s going on in their bank accounts and credit card statements—and may not recognize a fraudulent transaction. In addition, Millennials tend to use technology and social media more extensively, creating more exposure points for themselves.
Q. What is the most common form of bank fraud that victimizes Millennials?
A. Account takeover. Anytime there’s a user name and password, you are vulnerable. Millennials have a tendency to re-use the same password for all the things they sign up for, such as shopping apps and social media accounts. Armed with that information, a fraudster can then go to every bank and try to log in, assuming that person uses the same password on multiple accounts. Millennials also use less secure passwords, and that creates more opportunities to become victims of account takeover.
Q. Are you seeing any new forms of fraud?
A. I recently attended a conference where a speaker said the biggest source of fraud by 2020 will be ransomware: a type of malicious software covertly installed on a victim’s computer that blocks access to its data until a ransom is paid. Millennials aren’t necessarily the victims as it’s kind of agnostic. But the people perpetrating this kind of fraud tend to be Millennials. The old school fraudsters prefer more traditional methods, get good at it and stick with it. But Millennial fraudsters are willing to try new things. They have jumped on ransomware, the next big thing. In some cases, ransoms are paid with Bitcoin, as it’s less traceable. But there are a number of brick-and-mortar ransom methods. For example, the fraudster might instruct the victim to buy a loadable, pre-paid card and deposit the specified amount. The fraudster then tells the victim to give him the number.
Q. What’s really exciting now in your field of fraud prevention?
A. From a card standpoint, it’s the full implementation of the EMV chip card in the United States, which began last October. As other countries had converted from the magnetic stripe cards to the more secure chip cards before the United States, fraud just kept moving here. Once the EMV card is fully embraced by merchants in the United States, it will be hard to predict where credit card fraudsters will go next. Will it be more account takeovers? Or more fraudulent credit card applications? Or will fraudsters figure out a way to counterfeit the EMV chip cards?
Q. What’s the biggest challenge facing the banking industry in terms of preventing bank fraud against Millennials?
A. It’s ownership awareness. Millennials seem to have the mindset that fraud is strictly the bank’s problem. And yes, in most cases, the bank will be the one to reimburse you. But banks need to educate Millennial customers about using more secure passwords and being more careful with their banking and personal information. They need to get Millennials to buy into the idea that bank fraud is more than just an inconvenience: It can have serious consequences. When you’re frequently a victim of fraud, you eat into the bank’s bottom line. The bank may want to end the relationship with you and here’s why: You’re perceived as a risk.
Edmund Lawler is a business writer, author of six books and former editor at