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How Trustmark Overhauled Security to Thwart Fraud

  • By Deborah Peace
  • Published: 10/6/2016

Given the new, constantly evolving forms of payments fraud, it is critical that businesses understand the threats they are exposed to and how financial institutions can help them prevent such losses through stronger fraud prevention methods. While conventional fraud prevention methods work, they lack the flexibility and convenience to allow businesses to more quickly detect and respond to suspicious transactions. This was the case for Jackson, Miss.-based Trustmark, a provider of diversified financial services throughout the southeast.

Putting security in the customers’ hands

To strategically enhance the security of its business customers’ accounts, Trustmark overhauled its security measures and created a new method to detect and return unauthorized ACH debit transactions in real time. This approach to fraud prevention leverages the customer’s knowledge of their account, as they are most capable of determining the legitimacy of a transaction.

Trustmark accomplishes this by using communications technology, like SMS text, to deliver an actionable alert when an ACH debit hits the business’s account, allowing an unauthorized transaction to be stopped immediately. It is the business that recognizes the payment information details for the vendors and employees it pays, and therefore, it should be able to more easily distinguish who is authorized to debit its account than the bank. Trustmark realized this and as a result, its business customers can now quickly and easily identify trusted trading partners that can be automatically included in a pre-approved list for future transactions, as well as what conditions should prompt an alert. Utilizing the knowledge of their account, the customer should be the one to guide its financial institution’s decision to process or suspend a transaction.

Furthermore, Trustmark’s business customers can establish notification rules based on several factors, including dollar amount limits and how the debit was originated, enabling businesses to adjust their debit filters to tailor the notification and approval process. Since creating these new security measures, Trustmark has been able to monitor more than $4.3 billion, preventing unauthorized transactions and returning $8.3 million for its business accounts. For one particular business, the bank was able to stop several unauthorized transactions, which together totaled more than $855,000.

Planning for the future

Trustmark’s real-time fraud detection and response method is even more valuable now that same-day ACH has taken effect, which allows same-day settlement of electronic payments. One of the side effects of faster settlement will be the restricted timeframe to dispute an unauthorized transaction; therefore, from a regulatory standpoint, utilizing a real-time fraud prevention solution will enable the bank to better protect its business customers as accelerated settlements become standardized. By allowing account holders to review transactions in real time, unauthorized ACH debits can be thwarted and disputed instantly, before the debit posts to the account, effectively preventing fraud.

With the industry’s progression towards accelerated payments and the limited timeframe for businesses to dispute unauthorized transactions, businesses must be wary of cybercriminals’ changing tactics and prepare accordingly. Fortunately, through simple precautions, such as the ones Trustmark created, businesses can gain greater visibility and control over their own accounts. Enabling businesses to review and respond to suspicious activity before funds are disbursed is a forward-thinking approach to fraud prevention that will position businesses ahead of the evolving threats from fraudsters.

Deborah Peace, AAP, is CEO of ACH Alert, a provider of fraud detection services.

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