Beware! – Thieves are Stealing Business Mail…

…Which could contain your Check Payment to a Vendor!

Business fraud continues to occur in staggering numbers every day! Does your Company mail check payments to vendors and suppliers? If so, we encourage you to have a well thought out mail delivery plan to avoid stolen (and altered) check payments.

Companies are reporting an uptick in stolen vendor payments and those stolen checks are being used as templates to create new/more checks. If you are mailing check payments to vendors and suppliers we strongly encourage the following steps and/or considerations:

Stand alone mailboxes, beware

  • If you mail check payments to Vendors/Suppliers NEVER put those check payments in a standalone mailbox and put the flag up. If you are a business, you’re inviting fraudsters to steal your check payments. What other form of mail could you be sending each week on the same day?
    • We recommend all check vendor payments be dropped off in a blue USPS box, be hand delivered to a post office location, or request that your mail carrier come into your business to pick up outgoing mail. This helps reduce risk on the “outgoing” check vendor payment side, but also keep in mind you don’t know how the vendor is receiving the mail payment on their end. Do they have a PO Box or is your check payment sitting in a mailbox (possibly for days if delivered over the weekend) in a standalone mailbox waiting for a fraudster to steal?
    • If a Check is stolen, the fraudster now has the routing number, account number, and additional business information for your company. They know what your business checks look like, who signs them, and what sequence of check numbers you are in. They can easily alter the Payee Name by chemically washing it or create a new check using the stolen check as a template to create more checks.

Stop check payment fraud

  • Check Positive Pay is a cost-effective way to reduce risk and stop check payment fraud at presentment. Engagement in this service means each “Accounts Payable” cycle at your business you would import (or manually add) check issue information (Check Number, Check Amount, Check Payee Name, and Check Issue Date) to Nicolet Bank through the secure online banking portal. As checks are presented for payment on your business account the presenting check must match the Check Number, Dollar Amount, and Payee Name of what was provided as an issued check to Nicolet. If not, the check is flagged as an Exception for your chosen business users to review and approve for payment or return within a 24-hour timeframe.

Reduce ACH debits fraud

  • ACH Positive Pay is a cost-effective way to reduce risk and stop ACH debits fraud at presentment of an unauthorized EFT debit to your business account. Engagement means signing off on a list of “Authorized Companies”, those whom you have given your Nicolet Routing and Account Number to for debiting payments for services as needed. Common authorized companies include health insurance provider, 401K provider, government entities for tax related payments, etc., basically any company you have a vendor relationship with. Enjoy the ability to set maximum debit limits within the ACH Positive Pay system. When engaged in this service, any ACH Debit to the account that is not from a company on your authorized company list is flagged as an Exception for your chosen business users to review and approve for payment or return within a 24-hour timeframe.

Replace checks with ACH Network

  • If you’re mailing check vendor payments today, have you considered using the secure ACH Network to send electronic EFT payments? Using ACH takes physical paper checks and the risk of stolen/altered checks out of the payments ecosystem. Understandably checks will most likely never go away entirely, but advances in ACH and faster payments (Same Day ACH) offer businesses the ability to consider ACH as a secure and faster vendor payment option. If the need to send a large payment arises, could you adopt an internal policy to send via ACH versus a physical check in the mail that could be stolen and altered, and presented for payment fraudulently? (If your Company is engaged in Check Positive Pay this concern is null and void.)
    • If you determine sending vendor payments through ACH versus a physical check fits for your business you will need to create a Business to Business Authorization Form to gather the payment details of your vendor. If the vendor is uncomfortable sharing those details they may want to consider engaging in ACH & Check Positive Pay with their financial institution to protect their account(s).

 

The bottom line is that check vendor payments fraud is increasing rapidly and we want to help ensure you are sending check payments as securely as possible to prevent losses due to fraud. The time is now to evaluate your current check vendor payment process and make any necessary changes to further secure your business assets.

As always, contact the Nicolet National Bank Treasury Management Team or your Commercial Relationship Manager should you have any questions regarding this communication or the services recommended within it.

Stay vigilant!