Tips to Safeguard Against Financial Fraud

In today’s digitally connected landscape, safeguarding your small business against financial fraud is paramount. At Rally Credit Union, we understand the importance of protecting your hard-earned assets. Here are some insights into common financial scams affecting businesses and practical steps to prevent them:

ACH Fraud

What is ACH fraud? ACH fraud involves hackers gaining access to your business's account information and diverting payments to their own accounts. Be vigilant against phishing attempts and fraudulent websites designed to harvest routing and account numbers.

How can you prevent ACH fraud?

• Utilize a dedicated account solely for ACH transactions.
• Sign up for Rally account alerts to promptly detect any unusual transactions.
• Familiarize yourself with the typical ACH transactions of your clients and vendors to identify any anomalies.

Wire Fraud

What is wire fraud? Scammers may impersonate vendors or customers to provide wire instructions redirecting funds to their accounts. Once a wire transfer is initiated, the funds move swiftly between accounts, making reversal extremely difficult.

How can you prevent wire fraud?

• Verify any unusual wire requests by directly contacting the client or vendor using a verified phone number.
• Exercise caution with emails containing wire instructions, paying attention to irregular email addresses, formatting discrepancies, and informational errors.
• Implement strict controls on the authorization and execution of wire transfers within your business.

Invoice Fraud

What is invoice fraud? Fraudulent actors target small businesses with counterfeit invoices, demanding payment for purported goods or services. If the business complies, the fraudster absconds with the funds.

How can you prevent invoice fraud?

• Scrutinize invoices against purchase orders and contractual agreements to ensure legitimacy.
• Request the name of the individual authorizing the invoice from the vendor.
• Exercise heightened vigilance for invoices demanding expedited payments deviating from your standard payment terms.

For small businesses, the specter of fraud poses a significant threat, jeopardizing financial resources and operational efficiency. By remaining vigilant and implementing preventive measures, businesses can fortify themselves against fraudulent activities. At Rally Credit Union, we're committed to empowering businesses with the tools and knowledge to navigate the complexities of financial security.

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Learn more about scams and your small business by visiting the FTC website.