CONSHOHOCKEN, Pa. - Digital-image positive pay technology is helping Firstrust Savings Bank and its corporate customers fight back against a rising tide of check fraud, an executive says.
Robert J. Diegel, the bank's senior vice president of operations, estimated that check-fraud attempts last year increased by 15% to 20%, "in what we've been able to measure." That figure does not count noncustomers trying to cash checks who were turned away by tellers because of invalid identification, or other instances where it was unclear whether fraud was intended, he said in an interview this month.
The American Bankers Association reports that banks lost $698 million to check fraud in 2001. Community and midsize banks' share of the losses grew, while large banks' share fell as the result of improved detection systems, the group says.
Mr. Diegel said that the Philadelphia-area bank has responded by increasing training for tellers and other "customer contact" employees and that new technology has put big-bank capabilities within the reach of a midsize institution such as the $1.9 billion-asset Firstrust, which is owned by Semperverde Holding Co.
Firstrust added Internet features to its positive-pay system just more than six months ago, using a service provided by its item processor, Aurum Technology Inc. of Plano, Tex., and the check-image software vendor Advanced Financial Solutions Inc. of Oklahoma City.
The service automatically sends an e-mail notice, with a check image, to a Firstrust business customer if a name or amount on an incoming check does not match those of the check images on the customer's positive-pay list. It also gives a teller access to digital images of retail customers' signatures from account records and to the positive-pay files.
