Tangled wires

Automated Clearing House and wire transfers are increasing but so is fraud in these transactions. All a fraudster needs is an account number and a bank-routing number. Here are ways to prevent and fight these lucrative crimes.

Lori was a specialist in the Automated Clearing House (ACH) and wire transfer department at a mid-size bank. One day, she spotted a glitch in the web-based system the bank used to send and receive wire transfers, so she immediately logged off and notified her supervisor. However, it was too late; $3 million in aggregate wires had been sent from one of the bank's top-tier customer's accounts to an account at another financial institution. 

In this actual case, the supervisor and Lori (not her real name) called the system provider together and verified that the funds had been sent. They quickly switched to their older wire system that wasn't web-based, notified the customer, credited the account and began to investigate.

The bank eventually determined that an employee's computer had been infected with malicious software, which allowed the fraudster to initiate the attack from an external site and send the wires.