Business Fraud Prevention Tips From NSB

At Nevada State Bank, we work hard every day to help ward off threats and eliminate account fraud whenever possible. You've put in a lot of time and effort growing your business and keeping its bottom line healthy. Don't let thieves and fraudsters steal what you've worked so hard to earn. Here are some actions you can take to help make your bank accounts and financial transactions more secure:

Help Protect Your Account Information

• Check your account balance frequently and monitor account activity. Review your bank statements promptly upon receipt and report any discrepancies to the bank. Pay close attention to cancelled checks for altered payees or amounts.
• If you choose to retain printed copies of your bank statements, be sure to store them in a secure location.
• When it’s time to destroy bank statements or other documents containing account information, make sure to use a cross-cut shredder.
• Notify the bank of any suspicious phone or email inquiries, such as those asking for your account information. Nevada State Bank will never seek such information via phone or email.
• Guard your account number and your ATM PIN, and never share these numbers with others or write them down in an easily accessible place.
• Sign up for Purchase Alerts and Mobile Card Fraud Alerts. You’ll receive text message alerts on certain purchases made with your enrolled debit or credit card so you can respond quickly to potential fraud. You can choose notification criteria, like purchase amounts or online transactions. When you reply with a simple YES or NO, the bank either allows the transaction to go through or blocks it as fraud.

Implement Sound Business Practices

• Understand your liability. Review all documents and agreements given to you by the bank when you open your account. These documents inform you of your liability and responsibilities regarding your account.
• Establish dual controls for transaction processing and reconciliation. Allowing one person to approve invoices, prepare checks, sign checks, and reconcile bank accounts generally does not provide a sufficient level of security.
• Develop strict hiring practices. Use caution and discretion before you allow employees access to accounts or account information.

Help Prevent Check Fraud

• Use Positive Pay. If you’re enrolled in this service, the bank monitors the checks that are presented for payment and compares them to the list of checks you provide. Items that do not appear on your approved transaction list are not paid.
• Report lost or stolen checks immediately. This enables us to block payments on the check numbers involved. Review new deliveries of checks to make sure no check numbers are missing – they may have been stolen in transit.
• Store all checks in a safe place. Ensure that blank and cancelled checks are locked up securely at all times.
• Complete checks so they cannot be altered. Avoid leaving spaces on the payee and amount lines and use ink that can’t be erased.
• Keep signature stamps in a secure location. If you use a facsimile signature stamp, keep it locked in a location that is separate from your business checkbook.

Help Prevent Electronic Payment Fraud

As electronic payments become more widely used, the frequency of ACH fraud increases as well. The ACH Positive Pay service reviews ACH transactions presented for payment and returns unauthorized items. You are also able to create and manage filters so that expected transactions can post without review.

Help Protect Yourself in the Digital World

One especially dangerous fraud scheme is called Business Email Compromise (BEC). Also known as email fraud, BEC is a billion-dollar crime industry that tricks employees into sending money to fraudsters. In most BEC cases, a criminal sends an email to a company employee, impersonating the CEO or another executive who has permission to send wire transfers. They request that funds be sent immediately to a third party. Once the wire has been sent, it’s too late to recover the money.

Fraudsters may also impersonate companies’ suppliers, sending new payment instructions so that a routine transfer will be sent to a different account. In another scam, payroll representatives may receive an email appearing to be from an employee asking to update their direct deposit information. The new information generally leads to a pre-paid card account.

Create company policies to reduce your chances of becoming a victim of a BEC scam:

• Contact the requestor directly to verify they sent the email
• Make sure payment instructions agree with details on file
• Set up multiple approvals for large remittance amounts
• Implement approval protocols when executives initiate a transaction

Use All Available Anti-Fraud Resources

Nevada State Bank has a variety of resources to inform you about fraud schemes and help you avoid them. Check out our Business Fraud Prevention page, as well as NevadaSmallBusiness.com articles about how to help protect your company. Click here to make an appointment with a business banker to discuss any of the anti-fraud services discussed here.

The information provided is presented for general informational purposes only and does not constitute tax, legal or business advice. Any views expressed in this article may not necessarily be those of Nevada State Bank, a division of Zions Bancorporation, N.A. Member FDIC