Keeping Your Association Protected against Fraud

By Julie Celozzi / Published August 2024

In my more than 30 years of experience in banking and finance, I’ve learned that no individual or entity is completely immune to fraud, including community associations. However, association board members can take the necessary precautions to maximize financial security on their own and with guidance from an experienced financial institution. At Cogent Bank this is one of our top priorities. See our tips for proactive steps you can take today to keep your association and its members safe from potential fraud.

ACH Positive Pay

     ACH Positive Pay is a great defense against potential fraud. When you sign up for ACH positive pay service, you can establish a list of approved vendors for your association—typically including anyone you send regular payments to—and establish filters, including expiration dates and payment caps to further secure your finances. The approved vendors who meet the criteria you established with your filters are cleared through positive pay to receive automatic payments. This will ultimately help streamline your association’s payments and maximize its financial security.

Secondary Statements

     Secondary statements are a unique way some banks, including Cogent Bank, can help you keep track of your finances and monitor potential fraud. A secondary statement is a monthly report you receive from your bank that you can use to cross reference with your association’s internal records. Any discrepancies you see may be an indicator of fraudulent activity, giving you a direct alert.

Accessibility to Your Bank

     Financial experts witness fraud daily and are equipped with the knowledge and resources necessary to help prevent it before it happens. That’s why it’s so important to find a bank for your association that is easy to reach at any given time. Trust, transparency, and accessibility are essential in any banking relationship. Cogent Bank understands there is no one-size-fits-all solution to proper financial services, which is why we ensure that every client is given a hands-on, customized service catered to each of their unique needs. Not only is direct accessibility important, but also working with a community bank with local expertise and deep roots in the communities you mutually serve can be a bonus.

Working with Experts

     A financial institution that specializes in association banking, like our team at Cogent Bank, is an invaluable resource to help benefit and protect your association. Bankers with specialized training and experience working with associations can speak directly to the challenges and opportunities you face daily. Working with bankers with specialized expertise can allow them to audit your internal processes and identify opportunities to better secure your finances.

Skip the Mailbox

     The most common and simple way I’ve seen associations experience fraud is through their mailboxes. For ease, association boards often send and receive payments through a check in their mail, which compromises their financial security. It is all too easy for someone to intercept someone’s payments by stealing the checks from their mailbox, “washing” them, and depositing them in their own bank accounts. To avoid this, we always recommend bringing any outgoing mail directly to the post office to ensure your association’s safety.

Stay Up-to-Date

     It’s essential to always keep your information up-to-date in accordance with the State. The Florida Department of State’s Division of Corporations—commonly referred to as Sunbiz—contains a database of your association’s records. Fraudsters will access this data and alter it to their own benefit. Routinely keeping your information updated and accurate will help deter any fraudulent activity and protect your association’s finances.

     At Cogent Bank we understand what it means to be a true financial partner who puts your needs first. We provide personal connections with direct access to a full team, ensuring we are always available for immediate assistance. Our entrepreneurial spirit makes us adaptive and agile as we continue to grow to meet the needs of the markets we serve. 

Cogent Bank

     Cogent Bank is a state-chartered bank that has operated as a full-service business and personal bank since 2001. Cogent offers multiple banking centers in North, Central, and Southwest Florida that specialize in a wide array of traditional and nontraditional industries, including association banking, sports and entertainment banking, and non-profit banking, among several others. Cogent believes banking is personal and requires high-touch, innovative services designed to make managing financial transactions easier. To learn more, visit www.cogentbank.com.