8 Ways to Protect You and Clients from Financial Fraud

The predicament unfolding at Wells Fargo where 5,300 employees were fired due to phony bank accounts opened to “boost their sales figures and make more money” is not new in the financial world.

Unscrupulous practices have occurred for years in varying degrees.

In 1985, a just-fired employee at a New York-based commercial bank stood in front of his former co-workers to explain how he siphoned money from several bank accounts to which he had access.

The explanation was not to teach other employees how to do the same, but rather, done while the former employee was flanked on either side by his former supervisor and a security guard, it was a warning to workers that such theft would not go unpunished.

Working alongside those employees as a management assistant gave me front-seat access to a situation I did not know was possible until hearing the details.

Wells Fargo’s dilemma provides small business owners with vital lessons to keep financial accounts secure and relationships with clients strong.

Financial Fraud Protection Tips and Tricks

For You

1. Make time each month to reconcile your financial accounts. Even if an accountant is privy to your records, it’s imperative that you personally review statements in a timely manner.

2. Access your credit report every year through the free service, AnnualCreditReport.com or through another preference. Such review won’t help you detect fraud that occurs between yearly audits. However, you will still see details that may negatively impact finances.

3. Set up alerts through mobile banking, and that includes a password on your cellphone that prohibits access to financial records if your phone is lost, misplaced or scanned.

4. Install apps such as Dasheroo and PowerWallet on your cellphone to know what’s coming in and going out of your bank accounts. Most apps are accessible on your computer and tablet so there’s no excuse for not taking action at a moment’s notice.

For Clients

1. Send a letter of assurance by mail and email whenever mismanagement occurs in your industry. You’ll receive praise for reaching out in times of crisis whether it’s stated verbally or acknowledged silently. Send the notice in both formats to ensure notification.

2. Call clients by phone to back up mail and email notices as additional security to strengthen client trust and value in your service.

3. Save notifications that you receive from other industries to re-structure alerts sent to clients. This is helpful if you have difficulty writing copy and do not have staff or an on-call writer to create the content.

4. Become an ally by notifying clients each time disruptions come to light in industries that impact them. For example, if you are not in the financial industry, notification about Wells Fargo and pointing clients to an online article that helps them detect fraud positions you as a valuable and reliable connection.

Which of these internal checks and client-based services will you pursue tomorrow?

Financial Security Photo via Shutterstock