How To Help Protect Your Business from Fraud with Financial Services

Fraud is pervasive, and business owners always have to be on guard to prevent it. However, that isn't always easily done. Not only do small-business owners have a number of other responsibilities to attend to, but the evolving nature of cybercrime presents entirely new risks and dangers. And external fraud is only one side of the coin: in a 2018 survey from PricewaterhouseCoopers, 52 percent of all fraud is perpetrated by someone within an organization .

The costs of fraud notwithstanding, businesses can also suffer the effects in other areas, like reputation with customers. Altogether, fraud is among the most pressing concerns any business owner must confront. But the question of exactly how companies can go about strengthening defenses is always raised at some point. How can businesses help protect themselves against a threat that seems to come from everywhere? The answer, in many cases, is financial services.

What types of services fight fraud?

It's important to note that financial services are only part of an overall plan for fraud. For instance, businesses need to establish a culture of ethics and honesty to help prevent internal theft or deception. That said, financial services can serve as an effective tool in any organization's anti-fraud arsenal.

A modern approach to fraud means laying a comprehensive perimeter, targeting both new forms of fraud (cybercrime), as well as old (check fraud). Businesses need robust options that address all possibilities with services like: 

• Positive pay: Positive pay is a way for businesses to reduce check fraud and can be used in many cases. This service allows businesses and their banks to identify bad or unauthorized checks and catch fraud upfront. Positive pay is essentially a way to review checks against information on hand (number, amount, date issued) and can also be used for ACH debits. There are different levels of positive pay. Basic capabilities generally include reverse positive pay, while advance packages use image capture technology.
• Wire transfer service: A common cybercrime tactic today is email phishing, which involves a fraudster sending a seemingly legitimate email to an unsuspecting employee. Through impersonation, a criminal can then siphon off business funds, like posing as a vendor asking for repayment. Wire fraud has always been a concern for businesses, but the internet age has only raised the level of urgency.
• Online account takeover: The theft of personal information is also a common online fraud tactic today. Sometimes criminals get sensitive data like social securities numbers and password information, which could give them access to banking accounts. That's why businesses need online account takeover tools to step in and take action when fraud becomes apparent, or when a client is sufficiently worried they may have been compromised. 

When outlining their anti-fraud strategy, businesses need to start with a layered defense approach. Securing financial services and collaborative support needed to combat fraud on multiple levels and fronts can sufficiently prepare businesses and help protect them against damages.

Talk with your banker for more information. Please contact your local Vectra Bank.