Business Payments Fraud

As technology advances and criminals become more sophisticated, companies need to take steps to protect themselves from fraudulent activity. By understanding the risks and implementing safeguards, businesses can help ensure that they remain safe from scammers who are looking to exploit their vulnerabilities for financial gain.

Common Types of Payments Fraud

Payments fraud can take many forms, including:

Check Fraud:

• • Counterfeit checks: Created using computer software to look like legitimate checks.
  • Altered checks: Unauthorized changes to the amount or payee on an authentic check.
  • Forged endorsements: When a person signs someone else’s name on the back of a check.
  • Stolen checks: When a person steals or obtains unauthorized access to an existing check.

ACH Fraud:

Similar to check fraud, ACH fraud can happen when scammers try to initiate payments with your business's account and routing number.

Invoice Fraud:

• • Vendor Impersonation: Scammers may impersonate one of your vendors, reaching out to let you know that payment details have changed or simply submitting an invoice with a slight change to the payment information. — Hoping to divert money from your business to their own accounts.
  • Fake Vendors: Scammers will submit an invoice from a fake vendor for a lower dollar amount, in hopes that the payment will be approved without being questioned by the business.

Strategies & Best Practices for Preventing Fraud

In order to reduce the risk of becoming a victim of fraud, it's important for businesses to take steps to protect themselves.

Implement Positive Pay:

Review and Enhance Internal Controls and Systems:

• • Segregate duties and manage user’s access by assigning activity permissions within Civista Digital Banking and other software systems.
    
  • Establish dual controls. Dual control refers to having two separate individuals required to approve the release of funds and sign off on any transactions, such as ACH or Wire activities. This helps to ensure that only authorized personnel are allowed access to the accounts and that all financial activity is properly monitored and documented.
    
  • Utilize multi-factor authentication (MFA) for business software systems. Civista’s Digital Banking MFA protocol requires a secure access code be delivered to a user based on the secure delivery option on file with the bank – phone call, text, or by using a digital token. This can help ensure that only authorized personnel have access to funds.
    
  • Actively monitor accounts. It’s important for businesses to monitor their accounts regularly. Companies should review their transactions online and their bank statements for any suspicious activity or discrepancies. This can help detect and prevent potential fraud.
    
  • Activate account alerts in Civista Digital Banking. In addition to pre-set security alerts within Civista Digital Banking, companies should establish account activity alerts that may help detect suspicious activity on the account. This can help them quickly identify and address any potential threats.
    
  • Create a central point of contact for cyber and fraud escalation within your business. This allows businesses to quickly and effectively respond to any potential threats.
    
  • Review safe keeping procedures for the storage and handling of checks internally.
    

Educate Employees: