How Businesses Can Protect Themselves from Payment Fraud

Every day, businesses across the country face the risk of payment fraud. A 2023 survey by the Association of Financial Professionals (AFP) found that 65% of businesses reported being targeted by payment fraud in 2022, with check and ACH payments especially vulnerable.

With fraudsters becoming increasingly brazen and sophisticated, it’s critical for businesses to take proactive measures to mitigate payment fraud risks and prevent financial losses. Here’s what to know about some of the biggest payment fraud threats, and how Bell can help protect your business.

Check Fraud

Check payment fraud impacts businesses at a higher rate than any other form of fraud, according to the AFP survey, and statistics show check fraud is on the rise. In February 2024, the U.S. Department of the Treasury reported that check fraud has surged by 385% since the COVID-19 pandemic. And according to the most recent figure from the Financial Crimes Enforcement Network (FinCEN), financial institutions reported 680,000 possible cases of check fraud in 2022 alone.

According to FinCEN, criminals have been targeting U.S. mail carriers to steal personal, business or government checks. The fraudsters work to obtain the check funds, and then also use the account information included in the check to commit additional payment fraud in the future.

ACH Fraud

Electronic ACH payments are also common fraud targets, according to the AFP. ACH fraud can occur when a fraudster obtains a business’s bank account or routing number, such as from a stolen check, and uses that information to transfer money from the victim’s account.

How Bell Can Help

Payment fraud can impact businesses of any size at any time, and Bell offers services to help protect our business customers, including:

• Check Positive Pay: With this service, you’re able to match checks you’ve issued and authorized against checks that are presented for payment against your account. If the payment information doesn’t match, you receive an alert and can choose whether to pay or not pay the check, giving you peace of mind that you’re protected from check fraud.
• ACH Positive Pay: Similarly, Bell offers a positive pay service for ACH payments, which gives you the ability to identify specific businesses or vendors that can make electronic debits to your account, in addition to selecting specific dollar amounts or limits for those payments. When a transaction occurs on your account that doesn’t meet the criteria you selected, you receive an alert and can decide whether to allow or deny the payment. This gives you protection against fraudulent electronic payments.

Other Steps to Take

In addition to Bell’s positive pay services, there are other steps you can take to make sure your business is as protected as possible. These include:

• Providing a comprehensive fraud awareness training program for your employees.
• Implementing strong security measures and internal controls to restrict access to confidential bank or payment information.
• Conducting a third-party security assessment to identify areas vulnerable to fraud.
• Conducting a review of your insurance policy to make sure your business has appropriate coverage. If you don’t know whether your coverage can help protect you from payment fraud, or if you would like to request a new quote, contact Bell Insurance at 800-369-2501.