More businesses have started using ACH cards and other wire transfer methods in recent years, as these technologies can decrease the risk of late payments and improve overall efficiency in accounts payable and receivable. However, security concerns have surrounded these processes, as many companies have fallen victim to ACH and wire fraud attacks.
The Federal Bureau of Investigation recently announced that a Maryland man pled guilty to conspiracy to commit wire fraud after authorities discovered he had stolen more than $9 million from Southern Management Corporation, a Virginia-based business. According to the Bureau, the man, Robert Rood, and an accomplice, managed to steal the funds through the company's separate pension plan. Rood used falsified investment documents of all kinds, ranging from land acquisitions to construction paperwork, to defraud the company. The FBI noted that the Southern Management Corporation Retirement Trust incurred losses of $9,574,853 as a result of this conspiracy. Rood now faces a maximum penalty of 20 years in federal prison. ACH and wire fraud often happens in small, incremental losses over a long period of time, while direct deposit for employee wages is a popular target of these criminals. Businesses can avoid such massive financial losses by remaining mindful of all accounts payable and receivable transactions.