6.22.26 Greenville Chapter Meeting

Greenville Chapter June Meeting Key Take Aways!

1. Fraud Impacts More Than Just Cash

Fraud can have significant consequences beyond the immediate financial loss:

• Working Capital: Unexpected losses can disrupt cash flow.
• Reputation: Fraud incidents can damage client and vendor trust.
• Business Continuity: Recovering from fraud often requires account closures, investigations, affidavits, and operational disruptions.

2. Checks Remain the Most Vulnerable Payment Method

Despite increasing electronic payments, checks continue to be a major target for criminals.

Common check fraud schemes include:

• Fabrication: Creating counterfeit checks using account information.
• Alteration: Changing payee names or dollar amounts.
• Endorsement Fraud: Depositing legitimate checks into unauthorized accounts without altering the check.

Best Practice:

• Use Check Positive Pay.
• Consider moving as many payments as possible to electronic methods.
• Closely monitor large-dollar checks and verify endorsements.

3. ACH Fraud Often Begins With Social Engineering

Fraudsters increasingly target ACH payments through deception rather than technical hacking.

Examples include:

• Fake invoices.
• Fraudulent vendor payment instruction changes.
• Business email compromise (BEC).
• Unauthorized ACH debits.

Best Practices:

• Match invoices to purchase orders and receipts.
• Independently verify all payment instruction changes.
• Use dual approval workflows.
• Implement ACH Positive Pay and review activity daily.

4. Wire Fraud Is the Highest-Risk Payment Threat

Wire fraud follows many of the same tactics as ACH fraud but usually involves much larger dollar amounts and often cannot be reversed once sent.

Common schemes:

• Email compromise resulting in altered wire instructions.
• Fake “change remit-to” requests.
• Executive impersonation.
• AI-generated voice cloning and spoofed phone numbers.

Best Practices:

• Verify all wire instructions through a trusted secondary channel.
• Require dual approval for wires.
• Establish verbal passphrases for sensitive transactions.
• Never provide authentication codes to unsolicited callers claiming to be from your bank.

5. Fraudsters Exploit Human Trust

A recurring theme throughout the presentation is that fraud prevention is often less about technology and more about verification.

The recommended mindset:

Notice. Question. Validate.

Every request involving:

• Account changes
• New users
• Payment instruction changes
• Signer changes

should be treated as a potential fraud attempt until independently verified.

6. Dual Approval Is One of the Most Effective Controls

The presentation repeatedly emphasizes the value of requiring two people to approve electronic payments.

Benefits include:

• Segregation of duties.
• Protection against compromised email accounts.
• Prevention of fraudulent ACH and wire transfers.
• Reduced risk from phishing and business email compromise attacks.

7. Positive Pay Services Are Critical

The presentation strongly recommends:

Check Positive Pay

• Matches checks presented for payment against issued check files.

ACH Positive Pay

• Allows companies to pre-authorize which vendors may debit accounts and for what amounts.

These services move fraud detection from after-the-fact reconciliation to proactive prevention.

8. Real-World Examples Highlight the Risks

Examples discussed include:

• A roofing company that experienced repeated check fraud despite changing accounts.
• A technology company that nearly lost more than $15,000 through a fake invoice scheme.
• A property management company whose $20,000+ check was stolen and deposited into a personal account.
• A bank client who suffered wire fraud after logging in through a spoofed website.