Jan 22, 2013 Dave King
ACH cards and other electronic payments are increasingly popular with businesses in the United States and abroad, largely because of the cost-benefits and convenience of automated accounts payable and receivable. Companies that begin using such services can expect to see better efficiency resulting from decreased paperwork and streamlined filing through digital accounts.
However,methods that have become especially popular for payroll and vendor payments come with substantial risks when not handled properly. Executives should consider adopting advanced data security software and establishing firm policies to keep accounts payable and receivable monitored, protected and out of the reaches of incendiary forces.
Tips from the pros
Smart Business Online recently explained several ways in which businesses can avoid payment fraud losses that arise from ACH card and wire fraud. According to the news provider, a recent Association for Financial Professionals survey revealed that the most common amount lost by each business victimized by electronic payment fraud was just under $20,000 in 2011.
Fraudulent ACH payments were the second most common method of theft, while fake checks represented the biggest risks. The source explained that the study also revealed 66 percent of respondents cited being targeted by fraudsters, while more than one-quarter of these professionals experienced more attacks in 2011 than the year prior.
As a result of the digital revolution among enterprises, fraudulent activity has become more widespread than ever before, especially as the tactics used to steal money from corporate accounts are more affordable and simple than when paper payments were more commonplace. Smart Business Online said that ACH fraud involves the use of altered transaction specifications to redirect payments into a fake account.
The source explained that there a variety of fraud prevention tools available to companies today that can help decrease the risks associated with wire transfers and other electronic payments. ACH debit blocking is one such service that safeguards corporate accounts used to carry out wire transfers and automated electronic payments. The news provider also noted the positive pay defense, which involves daily updates to account numbers in the system, deterring long-term fraudulent activities which are often the most devastating.
Diligence, technology protect against fraud
Fraudulent forces continue to become more capable of conducting ACH card theft, especially as new advances in corporate technology provide more access points to critical banking information than ever before. Experts recommend a variety of protocols and best practices to help businesses keep their corporate accounts more secure in the age of digital theft.
For one, all accounts payable and receivable should be checked methodically to ensure there are no widespread fraudulent activities occurring. Businesses face the biggest risk when accounts have been used by fraudsters for long periods of time without any detection. Software can be a big help, but executives should always consider assigning trusted employees to check the accounts at least once or twice a week.
The best times to conduct these audits are the days after mass transfers through ACH cards at times directly following payroll payments and those issued to vendors.