News & Resources

ACH fraud remains an issue

Oct 13, 2013 Dave King

More organizations continue to launch electronic payment strategies to meet the demands of consumers, employees and vendors, while automation has also become more popular in recent years. While these trends are certainly helpful for the average business owner, ACH cards and wire transfers represent a unique threat to financial information and other types of data.

Hackers have increasingly looked toward these forms of payment processing as means to steal identities, money and corporate data, and organizations must respond by incorporating more effective policies and software. Without the right level of defense, losses can be enormous, especially as the average cost of data breach is nearly half a million dollars.

Still on the rise
American Banker recently reported that more cases of multi-million dollar theft through ACH and wire fraud hit the presses over the summer, and this trend seems to be continuing to rise. Two of the most common reasons behind this type of breach are the complete lack of oversight for automated payment processing accounts and human error.

Experts stress the importance of training all employees who will be involved with the accounts payable and receivable processes, as well as implementation of fairly simple and traditional network security software. Firewalls, data security solutions and other relatively affordable frameworks can make all the difference when trying to defend against these crimes.

According to the news provider, the last 15 months have seen a major increase in fraud related to wire transfers and ACH cards, likely resulting from the spike in demand from organizations for such services. Another issue is the speed with which threats proliferate, and how the government has thus far been incapable of keeping up with the advancement of hacking tactics.

Because organizations will often rely on legislators to set the proper security requirements through compliance statutes and several forms of support, businesses are at a distinct disadvantage today. The source asserted that the average hacker is now far more advanced than only a few years ago, and can easily slip through ACH and wire fraud protections that have not been updated since 2008 or 2009.

Take ownership
As the government struggles to keep up with the proliferation of threats and hackers have not slowed their efforts to steal money through these accounts, businesses need to take control of the situation. Organizations that handle financial data of any kind, especially those that have ACH and wire accounts, need to be more proactive in the deployment of security protocols such as policies, solutions and training.

Despite the fact that automation might seem to completely eradicate the need for oversight, these novel technologies and payment processing capabilities still demand a certain level of management. Corporate executives should always task trusted members of staff with oversight responsibilities that are carried out accurately and regularly.

While the accounts might not need to be watched on a daily basis, some evaluations and assessments should be conducted every couple of weeks or at least once a month. The most damaging instances of ACH and wire fraud are those that do not get identified for months.