If you have not yet experienced fraudulent attempts to pilfer your money, the operative word is “yet”. Recent months have seen a sharp increase in fraud cases – primarily involving manipulated payment instructions and check fraud. Whether you are new to the war against fraud or a battle-scarred veteran, the key to survival is diligent vigilance. Let’s look at the current battlefield.
Manipulated Payment Instructions
The Achilles Heel for this type of fraud is email. We’re all vulnerable to these attacks. Typically, manipulated payment instructions happen when one of the parties in a transaction has had their email hacked by a cybercriminal. Unless you’re an IT expert, you need a hired mercenary to represent you in this arena. Only an IT specialist with cyber security expertise can adequately protect your email and servers. If you don’t know one, ask us for a recommendation.
In most Manipulated Payment cases, the hacker will monitor email correspondence, watching for weaknesses and identifying prime opportunities to strike. Their goal is to fool you into diverting payment – via wire transfer or ACH – to their account rather than the intended recipient. One tactic is modification of payment instructions on legitimate invoices, especially from new vendors that you’ve never paid before. Another tactic is the bogus “notice of change” to payment instructions for an existing vendor.
The best defense against this type of fraud, is to ensure you and your staff are “verbally” verifying all new or changed payment instructions prior to initiating any payment. Do this only through known contacts or verified contact information. Never, ever trust contact information provided on the invoice as it could be manipulated as well. React Fast – If you detect this type of fraud, contact the bank immediately. Time is critical and countermeasures can be taken if you react swiftly in these situations.
Check Fraud
Although check fraud has existed for years, occurrences have recently skyrocketed. Despite the above commentary, electronic payments still offer greater protection and leverage to fight back than checks. The opportunities for fraudulent check interception and manipulation are myriad. Rather than cataloging check fraud techniques, let’s look at the best across-the-board defense available.
Positive Pay is a low cost, easy to use solution we provide. It matches checks you’ve issued to checks being presented against your account. If you’re currently using an A/P system, you can easily upload a check file after you process your check run. If you don’t use an A/P system or need to enter a “one-off” check, you can easily input single checks into the system. We compare incoming checks to your list by matching check number, amount, and payee. Then we provide you an electronic list of any exceptions, potentially saving you thousands of dollars. It also verifies and halts unauthorized ACH transactions.
Fraudsters are committed to their art.
Texas Security Bank is equally experienced, committed and armed to defend against fraudulent attacks. We provide market-leading tools in our never-ending battle against fraud. If you fall victim to fraud, our team of fraud specialists will fight tirelessly to get your money back. Join us in this battle! Train your employees in the art of “Diligent Vigilance” and consider using the fraud fighting tools we provide like Positive Pay. Together, we can win the war against fraud.
Want to learn more about how you can prevent electronic payment fraud? Contact us. We’re here to help.
Together We Fight ~
Shon Cass
EVP, Integrated Sales & Service