Banking Systems

Spotting Bank Fraud to Safeguard your Clients Investments

Spotting bank fraud is a difficult task that requires you to be on guard for fishy activity that fraud criminals will attempt to perform while you are not paying attention. But with quality fraud alert systems, the job gets much easier to detect. Although bank fraud does not usually include violence, it is still very much considered a serious crime. This white collar crime usually comes in two forms: misrepresentation or deliberate deception. The purpose of both is simply the fraud perpetrator’s own gain or advantage. In short, your bank will be on the losing end all the time when you are targeted by fraud criminals.

bank_fraudWhat are the most common forms of fraud committed against a bank?

Generally, most white-collar criminals falsify checks. They do this by altering the figures on the check itself or forging the check owner’s signature. For instance, what could be a paltry $100 written on the check can be magically changed into $1,100 simply by adding a 1 before the one of the hundred! On the other hand, anyone attempting to commit fraud could assume another individual’s identity to withdraw cash from the bank. In either case, the bank teller could be put on the spot and give out the money if an alert for a potential fraud is not given in time.

What could be a good fraud solution for a bank?

The best way to protect your bank from fraud artists is to be one step ahead of them. Yes, arming your staff and personnel with the right information regarding all the tricks known to defraud banking institutions should be known to the all the people handling money or overseeing the work of the tellers in the bank. When the people who man your teller’s booths or sit behind the manager’s desk are on to the schemes used by scam artists, fraud can be detected and stopped more easily.

What are the things that banks should be careful of when dealing with clients or people pretending to be their clients?

Whenever someone comes in with a check, it is of utmost importance to verify check images checking for alterations made to the actual layout and numbering. The bank teller presented with the check should see if all the details are on the piece of paper. He or she must see if the check itself is the standard check issued by the bank. There are con artists that duplicate checks and pass them off as the real thing. When that area is covered and the check is confirmed to be real, the bank teller must see if the information provided on the check, like the date, is correct. Plus, the name of the payee should be reviewed. Finally, the signature of the signee should be verified. This is the final step that can ensure that the check is valid and was actually issued by the person whose name appears on the upper left hand side of the check.

Signature verification

signature_comparisonThe next thing that your bank teller must do is use signature authentication software to see if the signature indeed belongs to the issuer of the check. There is very powerful software today for banks to use in order to compare that signature that appears on a check with the signature that is actually in the bank’s database. With this technology, it is easier and quicker to spot forgeries. Besides, the software itself will issue a warning whenever a signature is determined to be a copy or forgery of the real thing. This is also another reason why your bank should convert signature cards to electronic records. With electronic records, bank tellers don’t waste time in checking the signature on a check against the signature on an actual signature card. The signature authentication software is also capable of providing a confidence rating for the validity of the signature.

In conclusion, spotting fraud is made easier with the latest technology. Be sure to equip your bank with such in order to safeguard your assets as well as your clients’ investments.


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