Community Bankers' Advisor

i  September - October , 2003

Page 4 


opened fraudulently, you have effectively, but subtly, alerted the proper party in time to prevent damage. If the account is legitimate, the letter will appear as a nice marketing gesture. Welcoming letters are a good tool to use with new customers of all types.

Any time an individual is added to an account under a Power of Attorney or court order, a letter should be sent to the account address confirming the addition. Signatures on POAs should be checked against the signature card.

Use caution with emailed requests. You may know John Doe's email address is johndoecustomer@aol.com, but if you receive an email request from that address you can't be sure John sent it. Let's say John and Mary Doe have a joint account. You get an email from him saying "Please remove me as a joint owner from the above-referenced account. John Doe." You assume the email was from him. Oops! Turns out
John left his computer behind when he and Mary separated, and Mary used it to impersonate him. Always resort to real-world confirmation of cyber-requests.


 

If an owner of an account orders you to remove an authorized signer, consider notifying the authorized signer with a courtesy call or letter. If the owner and the signer have gotten into some sort of nasty dispute and the owner has not notified the signer that he is being removed, the signer may unwittingly keep writing checks. If you pay those checks, you may incur some losses. Ask the owner at the time of the removal if the signer still has any blank check stock and if the signer is aware of the change. If the signer still has checks, you may want to require the account to be closed and open a new one to avoid unauthorized signature problems.

Simple steps like those outlined above can go a long way toward protecting your customers - and protecting your bank.

Copyright © 2000 Bankers' Hotline. Originally appeared in Bankers' Hotline, Vol. 10, No. 7, 7/00 (reprinted with permission from the author)

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DISCLAIMER
COMMUNITY BANKERS' ADVISOR is designed to share ideas and developments related to the field of banking. It is not intended as legal advice and nothing in the COMMUNITY BANKERS' ADVISOR should be relied upon as legal advice in any particular matter. If legal advice or other expert assistance is needed, the services of competent, professional counsel should be sought.

Gold Bard

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