Legal Seminar, Chicago, IL

Patco Const. v. People’s United Bank (1st Cir. 2012)

 Bank implemented security procedure  User IDs and Passwords  Device Authentication  Risk Profiling

 Challenge Questions  Dollar Amount Rule  Subscription to eFraud Network

Bank’s Errors

 Bank failed to account for customer’s transaction history  “Bank did substantially increase the risk of fraud by asking for security answers for every $1 transaction, particularly for customers like Patco which had frequent, regular, and high dollar transfers.”  The bank “essentially deprived the complex . . . risk-scoring system of its core functionality.”