5 Simple Tips to Protect Your Business Checking Account
Your quarterly account reconciliation is off. You’ve rechecked the figures, but profits are nowhere near what you’d projected. As you lean back in your chair, you recall that last quarter’s financials also showed a slight dip in revenue. Last time, you dismissed it as an accounting error. However, this time, the difference is significant. A possible explanation is one that some businesses are hesitant to consider: Fraud.
While newspaper headlines might focus on illegal financial activities perpetrated by or against publicly traded corporations, private businesses aren’t immune to fraudulent activity. In a 2018 Association of Certified Fraud Examiners study, over 70 percent of the reported fraud occurred at for-profit organizations, with 42 percent of the victim organizations being private companies.
A common misconception is that fraud only happens when companies fail to implement proper cybersecurity measures. While this might be a contributing factor, informal or relaxed internal processes may also be to blame. Whether a cyber-criminal or trusted employee is responsible, businesses attribute a median loss of 5 percent of their annual revenue to fraudulent activity.
Fortunately, businesses can take steps to decrease their risk of becoming the next fraud statistic. Here are five simple, yet effective, ways to monitor ENB account transactions and keep company funds in your account where they belong.
#1 Immediately report missing checks.
If you receive a past due notice on a vendor payment or check that you’re confident you paid by check, notify ENB at once. Fraudsters alter stolen checks and sometimes wait four to six months before cashing them. While thieves can alter and deposit the checks right away, some will wait longer hoping that business owners are no longer paying attention. Rather than assuming the check was lost in the mail, contact ENB to process a stop-payment on the check. This will prevent payment should someone attempt to cash the check in the future.
#2 Verify the variants.
Pay special attention to transactions that are different from the norm. If one should appear, confirm the validity of the transaction instead of dismissing it as a one-off occurrence. Reduce the chances of questionable activity appearing on your account in the first place by avoiding transactions initiated from sources that are known for fraudulent activity such as auction and work-for-hire websites.
#3 Review your account often.
Quarterly or monthly account reconciliation isn’t enough. Stay on top of potential red flags by reviewing your account daily using ENB Online Banking. Daily account review is best, but at the very least, plan for every other day. This will help identify unusual activity when it starts and can minimize potential losses.
#4 Rethink vendor payments.
Does your business place outgoing checks and vendor payments in a business mailbox with the flag up? Are these payments made at the same time each month? Thieves look for clues and patterns like these to snare their victims. To avoid becoming their next target, use a secure method to mail payments. Hand outgoing mail directly to the mail carrier or use the letter slots inside your local post office to bypass fraudsters.
#5 Take swift action when you suspect suspicious account activity.
The sooner you report potential fraudulent account activity, the increased likelihood of funds being returned to your account. For example, a fraudulent check submitted for payment can be returned as soon as the same business day ENB is notified, at no loss to you. Enroll in Positive Pay, an automated fraud detection tool that helps businesses shield their accounts from fraudulent transactions. Contact an ENB representative today to learn more about how this tool helps detect and block fraudulent checking, ACH, and debit transactions.