BY DAN HILDEBRAN
Monitor Editor
KEYSTONE HEIGHTS— The Feb. 22 meeting of the Lake Region Prosperity Partners featured advice on offline and online security.
Susan Aarons, a treasury management banker with Capital City Bank spoke to the Clay Chamber group about trends in fraud that she is seeing across the state.
She said two types of fraud that are increasing now include check fraud and schemes involving the redirection of payments.
Payment redirect fraud
Redirection of payments occurres when a fraudster calls or emails a business, impersonating a vendor, and requests that payments to the vendor be redirected to a new routing and account number, controlled by the thief.
“Anytime you get a (message) like that to redirect a payment, the best thing you can do is pick up the phone and call and verify that with your vendor,” she said. “I cannot tell you how many clients have gotten something like that and they’ve either ACHed it out, or they’ve been told: ‘I tried to process your check and it didn’t work. I need you to wire $30,000 to me. Here’s my routing number and account number.’ They will email back and forth, and everything seems legitimate, but it’s not. It happens every day.”
Aarons added that payment redirect fraud is widespread in the construction industry.
“Fraudsters will go in and they will see who is pulling permits,” she said, adding that crooks will then email an organization, like a hospital that is adding on a wing.
“I’m a hospital and I’m doing a big add-on and I have contracted ABC construction (to do the work),” she said. “(The fraudster) will pretend to be ABC Construction and send the hospital an invoice and say: I need immediate payment to this bank account.”
She added that because ABC Construction is legitimately doing business with the hospital, the facility’s accounts payable department doesn’t question the invoice.
“They don’t think about it, and they don’t verify it,” Aarons said, “and the next thing you know, they have a huge payment that goes out.”
“Watch your email,” she added. “If it doesn’t look right, if it doesn’t smell right, it’s not. Pick up the phone and verify.”
Check fraud
Aarons said reports of check fraud have increased from around three cases a month five years ago to three cases a day now.
“Anytime you put a check in the U.S. Postal Service, and you put a stamp on it, and it is out through the mail, it is a risk,” she said. “Let’s say I’m leaving today, and I put my utility bill in the mailbox, and I put my flag up. The fraudster can drive by, see that flag, open my mail, take a photo of my check and they have my routing number, my account number and my signature.”
Aarons added that blank check stock is readily available at any office supply shop. Using the information they obtained from the mail, thieves can easily produce fake checks and attempt to pay bills using the victim’s bank account.
Alternatively, thieves can attempt to steal funds using an ACH transaction. Aarons said everyone should check their bank accounts daily for suspicious activity.
She added that for some ACH transactions, businesses have only one day to dispute a payment. She also said her bank, as well as other financial institutions, have products that can block unauthorized ACH transactions.
Banker victimized by identity theft
Capital City Bank Bradford-Clay President Patricia Evans told the group that she was recently a victim of identity theft, even though the incident did not cost her any money.
Evans explained that she received letters from two investment firms thanking her for opening accounts with them. She, however, never opened the accounts.
The banker added that she is very careful about handling her personal information and has never been a victim of identity theft before.
One of the investment firms told Evans that identity thieves are now opening investment accounts in the name of victims, hoping to generate profits within the accounts, and then withdrawing the funds. The taxable gains within those accounts are assigned to the victims’ social security numbers, allowing the identity thieves to earn the investment gains tax free.
Landscaping and security cameras
Timothy Mulvaney of the Clay County Sheriff’s Office talked to the group about increasing physical security at their businesses and homes.
He said one key security feature is landscaping and maintenance, adding that crooks will hide in overgrown vegetation and then victimize unsuspecting business owners or residents.
He also said keeping storefront windows free from advertisements, flyers and other clutter can allow passing motorists or pedestrians to see what is going on inside a store and alert law enforcement if they see anything suspicious.
Mulvaney also recommended security cameras, noting that the devices often serve as a deterrent to robberies. He encouraged businesses to make cameras visible and recommended business owners post signs, notifying would-be thieves that they are being watched.
The officer added that lighting, particularly outdoor lighting can affect the quality of video captured on security cameras.
Lastly, Mulvaney encouraged business owners to report suspicious activity and crimes to the sheriff’s office, no matter how small.
“A lot of people will tell me: ‘Hey, you know we didn’t feel like reporting it because we didn’t think it was a big deal,’” Mulvaney said. “However, it is a big deal. There could be five different people that are experiencing the same thing, but they don’t realize what’s going on and if you don’t report that to the sheriff’s office, we’re not going to know.”
Mulvaney added that crime analysts at the sheriff’s office look for patterns and trends of incidents occurring throughout Clay County, and the more information they get from victims, the more information they can forward to investigators.
