Check Fraud Protection: Individual and Business Accounts Are Not Treated The Same

Today’s advanced technology makes it easier than ever for criminals to fraudulently replicate your checks.

Individuals generally have 30 days from the receipt of their monthly bank statement to notify the bank of suspicious activity in their account. Typically, the bank offers free protection from fraudulent activity, and will happily reverse the transactions to keep their customers’ accounts secure.

But did you know that business accounts usually have only 24 hours from the presentation of a fraudulent check to notify the bank in order to receive the same protection? City National Bank, with whom we have had a close relationship for over 20 years, has a system which allows any bank customer, whether individual or business, to be able to protect their bank accounts from fraudulent activity through their Positive Pay service.

City National Bank’s Positive Pay service is an effective tool in the fight against check fraud. Their Payee Verify feature offers additional protection by identifying payee name suspects. Positive Pay works with you to verify that you have actually issued the checks that post to your account. They will even verify checks as they are cashed at their banking offices – a feature many banks don’t offer.

How Does It Work?

1. Simply log your check information in a data file.
   A data file is created for each check that you issue, logging the issue date, the serial number, and the amount of each check. This is similar to a check register, but instead of your pocketbook, the information is stored securely online. When using the Payee Verify feature, you can also store the name of the payee. You then send the data file electronically to the team at City National Bank.
2. City National Bank verifies the checks.
   CNB’s team then compares your check data to the checks posted to your account. They’ll even match the info with checks presented over-the counter.
3. You receive an Exceptions Report each morning.
   When CNB notices a mismatch between your issue data and the checks posted to your account, it is recorded on an Exceptions Report. You can view the report early each morning online via the Treasury Net Positive Pay service. Even if you have no mismatches, you can still view the Exceptions Report daily. When using Payee Verify, any differences in payees will also be noted in the Exceptions Report.
4. Make payment decisions on your terms.
   You can decide whether to pay the checks that pop up on your Exceptions Report easily through the online system.

Benefits

The Positive Pay service is a great tool for small businesses to avoid check fraud. Fraudulent items and payee suspects are quickly identified so you can notify the bank as soon as possible. All checks from your account – even the ones presented at banking offices – are verified by CNB’s team and you through the Exceptions Report.

For added protection, you can use the Payee Verify feature, specify dollar limits, and review stale-dated checks in your Exceptions Report.

The protection provided by this system is invaluable to both individuals and businesses alike. We encourage you to check with your bank to see if they offer a similar program to defend against this growing problem.