Cable Dahmer’s Solution To Check Fraud
Business leaders now need to consider different vulnerabilities compared to a decade ago. The most glaring differences fall within cybersecurity, computers and the digital space, but other fraud vulnerabilities have also emerged.
Rick van Zon, Chief Financial Officer at Cable Dahmer Automotive Group, for example, could no longer trust that mail dropped in a public mailbox was safe from interception. A few months prior, van Zon noticed strange activity on smaller accounts during his daily bank reconciliations. These lower-volume accounts, with only one or two checks per month, were now encountering fraudulent activity. Larger accounts were protected by positive pay, a check protection service from Enterprise that deters fraud by matching the checks a company issues with those it presents for payment. But such low-activity accounts did not seem to need positive pay protection.
Van Zon scrutinized the accounts and noticed that a week after he dropped a check in the mail, there were fraudulent checks on the account. He had left the check at the local post office parking lot mailbox but soon realized that the check had been stolen and both check and endorsement fraud had taken place. “The team at Enterprise was a big help guiding us as we recovered. But the time, thought and concern of what happened and where it came from — on top of finding another post office — were substantial.”
After the incident, they immediately added positive pay to all of the company’s accounts. “No matter the size of the account or volume, put positive pay and debit blocker on it,” says van Zon. Specifically, check positive pay references the account number, check number and dollar amount of each check presented for payment against the checks authorized and issued by the business, thus allowing a business confidence that checks received are going to clear.
If you also use ACH transfers to accept and make payments, an ACH debit blocker prevents any funds from leaving your account without your approval. This protects your business from hackers in the event that they obtain your account information and attempt to withdraw funds.
Internal processes are equally critical. Van Zon stresses the importance of reviewing and reconciling accounts daily in order to spot suspicious activity. Payments fraud prevention requires not only communicating with the accounting department, but with frontline employees as well — workers who are on the floor or in the field accepting payments need to be trained, too.
If you instill organizational procedures such as always attaching a copy of a receipt to a check, deciding not to accept checks via email or even requiring two authorized signatures on company checks over a specific amount, you need alignment across your team to implement these procedures successfully.
For companies like Cable Dahmer Automotive Group, one of the biggest fraud-related challenges is criminals’ seemingly endless creativity, according to van Zon. “We know how to prevent what’s happened already, but we don’t know how they will come at us next time.” Being equipped to adapt rapidly to emerging fraud threats, talking about fraud prevention on a regular basis and having strong financial partners allow you to face fraud head-on.