Everywhere you look today, financial fraud is making headlines. From cyber-attacks to payment fraud, many business owners and financial professionals ask, “How do I protect myself and my company?”
An example of payment fraud that is rising nationally and here in our area is check fraud. Check Fraud can take a few different forms, the most common being counterfeit checks and check alterations. Counterfeit checks can be created from legitimate bank accounts using high-quality equipment. These fake checks have become increasingly more realistic with the sophistication of today’s copiers and scanners. In many instances, they can look almost identical to the check stock the business uses. Check fraud can also involve the alteration of real checks. Legitimate check information can be removed so that the amount or payee can be altered to benefit the fraudster.
Check fraud is one of the easiest ways to perpetrate fraud against a company; however, there are steps that businesses can take to minimize their risk of a fraud attempt.
- Always secure your check stock and deposit ticket. Many times, checks are stolen from the bottom of the check pile, allowing more time to pass before it is noticed, if at all.
- Monitor your activity daily and reconcile your statements monthly. Banks can help if fraud is caught within 24 hours. After that, the chances of recovering the loss are reduced significantly.
- Report any discrepancies to your bank immediately.
- Never place your outgoing mail in an open place where it can be intercepted.
- Use dual control within your organization.
- Utilize Positive Pay. With this service, the customer provides the bank with their issued check file through a secure site like online banking. As the checks clear, the bank matches them against the file, and any exceptions are sent back to the customer for a “pay” or “no pay” decision. Positive Pay prevents check fraud before it happens.
By taking extra measures, you can protect your company against the inconvenience, anxiety, and potential monetary loss a check fraud attempt may cause. For questions or to learn more about fraud attempts aimed at businesses, please contact our Treasury Management Team.