Fraud: The Cost of Action vs. the Cost of Inaction

Should you operate a business of any size, in any industry, the question is no longer if that business will fall victim to fraud, but when it will.

That’s the harsh reality, according to Steven Clark and Amber Frantz, Vice Presidents in Treasury Management for Wisconsin Bank & Trust, a business-focused community bank that is part of Heartland Financial USA, Inc. and serves customers in the Madison, southeastern Wisconsin, Green Bay, Sheboygan, and southwestern Wisconsin areas.

“Clients may think, ‘It’ll never happen to me.’ But they’re either very lucky or their number is going to be up soon,” Clark says. “I don’t know one company that has never placed a ‘stop payment’ on a check or taken other steps to undo something that happened after being hit by fraud.”

Among the most common types of fraud is social engineering — that is, the use of deception to manipulate individuals into divulging confidential or personal information that may be used for fraudulent purposes. For example, an email from an unknown sender might contain an attachment embedded with malware that could infiltrate a company’s internal operating systems. Opening it could unwittingly allow hackers to fraudulently approve money transfers and other activities that eventually could bring a business to its knees, both financially and operationally.

“We educate every prospect and client about the fraud landscape and what they can do using bank products and services, and helping their employees better understand what they should and shouldn’t do,” Clark says. “The last thing you want to do is open an attachment from someone you don’t know.”

While no silver bullet exists to rid the business world of fraud, there are ways to protect yourself. They include using electronic accounts payable as a one-time payment check-replacement system and so-called “ghost cards”— which aren’t really cards at all, but rather specific card numbers assigned to specific vendors for all transactions with that vendor.

Wisconsin Bank & Trust offers a holistic approach to commercial card payment solutions, allowing for a variety of payment options. In addition, they provide Treasury Management solutions including Positive Pay and ACH Alert, that help guard businesses against fraud. “The most efficient services we provide also are the least expensive and the least susceptible to fraud,” Clark says.

October is Cybersecurity Awareness Month, and Wisconsin Bank & Trust will host two seminars on Oct. 18 designed to help businesses protect themselves against not just cyber fraud, but other types of fraud as well. The first seminar will be held in Monroe from 7:30-9 a.m., and the second will be held in Madison from 12:30-2 p.m. Opportunities also will be available for one-on-one consultations after each seminar. If interested, please reach out to Clark or Frantz to reserve a seat.

“The education piece — what are you doing to protect against fraud and what else can be done? — is never missing in our client conversations,” Frantz says. “It’s that important.” “Literally, every transaction that is created by a client has some sort of risk affiliated with it,” Clark concludes. “And, it’s our role to make sense of it all.”

Fraud: The Cost of Action vs. the Cost of Inaction