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ACH Fraud and Related Risks

The Automated Clearing House (ACH) network is a nationwide electronic payment and collection system that many companies have used for years. ACH processing can be less expensive and a more efficient payment method. While the growth of electronic payments is a positive development, it also poses a risk - ACH payment fraud. Someone with a criminal intent need only your ABA number and account number to initiate fraudulent entries to your account.

The ACH rules require that unauthorized ACH transactions to your business account are returned within 24 hours and they look to companies to protect against these losses. It is much easier to recover losses if you notify your bank within 24 hours to minimize your risk.

Most companies may never experience ACH fraud, but you can take these steps to help protect against this type of loss:

  • Protect your company's sensitive information such as checking account number and ABA number (bank routing and transit identification number).
  • Establish controls over your printed check stock.
  • Monitor your account activity daily.

Connecticut Community Bank can help you protect your account from fraud by using our ACH Debit Block service. All ACH transactions against your deposit account would immediately be returned. However, if your company has a reoccurring ACH transaction for insurance payments, tax payments or other vendor payment, this service would not be appropriate for your account.

Please contact your local branch office for additional information.

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