Wire Transfers and Your Business
October 24, 2018
Sometimes it feels like a hassle. Your business needs to quickly send funds to purchase inventory, or the property closing is scheduled and the funds need to be wired ASAP! It would be so much easier to simply send the bank an email with the wire request. Instead, you log in to your business online banking account and wait for a confirmation call back. Why so many steps? And does this process protect against all fraud?
First: Email fraud is real. Criminals gain unauthorized access to a business’s email account, or mimic the address with a tiny difference. They generate a wire transfer request that appears to be legitimate and attempt to complete the transaction before the fraud is discovered.
Second: The nature of wire transfers makes recovering lost funds incredibly difficult. Immediate availability at the receiving bank makes wire transfers vital for conducting legitimate business. This attribute is also what makes the system such an attractive target for criminals.
By following strict procedures, banks uncover millions of dollars in potential wire fraud each year. Secure requests processed through online banking and verification steps by bank employees offer some security. However, in many cases the business requesting the transfer has been duped from the onset. Believing the request is authentic, they complete the bank’s secure process and unwittingly send money to an impersonator.
Business leaders can help protect themselves by taking a few simple steps:
Be suspicious of wiring instructions. When you receive a wire request from a client or vendor, whether by email, phone, or letter, it’s a best practice to independently verify those instructions through a different avenue—not the phone number listed in the correspondence or Caller ID. Even if double-checking delays the transaction, it is a vital step in protecting your business.
Protect your email accounts, and encourage those sending you wire requests to do the same. Email hacking allows the fraudulent request to be sent from a legitimate and known contact address. As a result, business email compromise is a sophisticated and growing threat in our digital world. Information on phishing emails, the benefits of strong passwords, and cyber security is available in past blog posts.
Be alert to small changes. Do the account and call back numbers match previous requests? Is the wording and style similar to past correspondence? Thieves are counting on the distraction of busy office life causing you to overlook these clues.
Train employees to be suspicious, too. Ask employees to be alert to unusual requests that appear to be from a senior manager at your company, or come unexpectedly from a vendor. Criminals will try to mimic the email of a senior person at either end of the transaction and use the address to send a wire request. Employees who feel empowered to take the time for a little extra research could help save your business thousands of dollars.
When in doubt trust your instincts! If you are uncertain about a wire request do not hesitate to contact your local branch for assistance.
Member FDIC / Div. of Glacier Bank