Prevent wire transfer fraud: Genome’s tips for businesses

Prevent wire transfer fraud: Genome’s tips for businesses

Learn about the best practices in wire transfer fraud prevention from Genome’s Džeineta Dalia Pumputytė – Head of KYC, Deputy Head of AML, and Compliance.

For additional information, check our one-pager on the matter.

Do you want to know how to keep your information and funds safe from the most common types of fraud? Check Genome’s security page, where we list our advice.

What is wire transfer fraud? 

It is a type of fraud that involves the misuse of any electronic money transfer services by malicious actors for their personal gain. To commit wire transfer fraud, scammers first use a variety of deception methods to trick an individual or a company into sending funds to the account created specifically for their fraudulent scheme. 

Businesses can fall victim to wire transfer fraud as well. Thus, it is essential to know how to spot and avoid it.  

How can your business prevent wire transfer fraud?

You need to focus on three main courses of action to increase your chances of avoiding wire transfer fraud.

“It is important to remember that fraudsters can use different channels to reach out to their potential victims, social media and applications such as WhatsApp included. In such cases, they will likely ask for your personal information. Remember that no licensed financial institution, including Genome, will inquire about your personal details via social media.”  

Džeineta Dalia Pumputytė

How to foster a culture of compliance and vigilance among the staff to prevent wire transfer fraud

Have a strong core for your compliance procedures:

  1. Establish an information security department (ISD);
  2. The ISD must provide a comprehensive security strategy;
  3. Based on the strategy, regular staff training must be implemented.

“Having a security strategy is crucial for your compliance efforts, as well as for the provision of training for your personnel. All the rules described in it must be written in a clear, accessible tone for staff to digest and memorize easily.”

Džeineta Dalia Pumputytė

To keep up with current security threats, including wire transfer fraud, a company needs to:

  • Regularly monitor potential threats and improve the strategy accordingly;
  • Hold yearly tests for employees to refresh their knowledge of established policies;
  • Have a system of penalties and rewards for breaking/complying with set security measures; 
  • Create an anonymous reporting system for suspected information misuse, fraudulent cases, etc;
  • Delegate money transfer-related responsibilities to a select group of authorized employees and establish rules for authorizing and sending payments.

What you can do to minimize potential losses in case of a suspected wire transfer fraud

Contact Genome immediatelyIsolate all accounts and systems that can be potentially affectedInvestigate the case internally to know the extent of the damage doneStart implementing security protocols developed earlier for cases like these
Contact the law enforcementConsult with the legal department to know how to proceedNotify staff, shareholders, and other relevant partiesFind out which security protocols failed to prevent the incident

Examples of effective communication strategies for verifying wire transfer requests without causing inconvenience or delay

If your business receives a request for any money transfer, here’s how you can verify it:

  1. You need to have tools and software in place that will allow for the authentication of a person/company that requested a transfer.
  2. Know Your Customer procedures can be used to confirm the requestor’s identity.
  3. Your employees can contact a person/company that requested a transfer to confirm it.
  4. If you have doubts, ask for additional information and documents that support the request.
  5. Make sure your employees are educated on all due diligence procedures and follow proper authentication and confirmation methods before completing the transfer request.