Hoosier Banker Any discussion relating to policy language and/or coverage requirements is non-exhaustive and provided for informational purposes only. This information provides guidance and is not intended as a legal interpretation of any federal, state or local laws, rules or regulations. ABA Insurance Services Inc. does not warrant that all potential hazards or conditions have been evaluated or can be controlled. 1 2018 ABA Insurance Services Inc. claims data 2 fbi.gov/news/pressrel/press-releases/fbi-releases-theinternet-crime-complaint-center-2018-internet-crime-report % Instructions are suspected by the bank to not be genuine. While there is no standard template for written agreements, they generally are similar from bank to bank, with minor modifications for unique circumstances. Regardless of your bank’s unique situation, it is recommended you review your written agreement with legal counsel to ensure it is commercially reasonable and meets your needs. How do written agreements tie to insurance coverage? Most insurers require a written agreement between a bank and its customer when evaluating the applicability of insurance coverage in the event of a claim. As a condition precedent to coverage, you must have a written agreement in place with your customer in order for insurance to respond to a loss, regardless of how the instructions are received. The policy language governing this requirement is generally found in the funds transfer coverage part or in the definition of customer of your financial institution bond. Transfer requests and written agreements are commonly confused. A transfer request is nothing more than the initiation point for the movement of funds. It is not the same as a written agreement and will not satisfy insurance policy requirements. Best practices to follow: 1. Have a written agreement in place before the first request to transfer funds. As a standard course of action, written agreements should be executed at the time an account is opened or at some point before a transfer request is made, not when a customer is on the phone seeking to move money. 2. Train your employees to trust their gut and stick to the written agreement instructions. Fraudsters can be very convincing, and they are often adept at manipulating situations in their favor. Your employees are your best defense against fraud. Give them the authority to trust their instincts and stick to the instructions in the written agreement, even in the face of pushback from a customer. 3. Scrutinize certain types of requests closely. Transfer requests tied to real estate transactions, home equity line of credit accounts and international destinations should be evaluated closely, as they are more prone to fraud. You should also designate all transfer requests made by elderly customers as high risk. Unfortunately, the elderly more easily fall victim to fraud, and instances of financial abuse against senior citizens are welldocumented. HB BANKING ON COMMUNITY Alliance Bank, Francesville, donated $600 in November to Hope Springs Safe House, which provides emergency housing and services to women and their dependent children coming out of domestic violence situations. A concerning consequence of the COVID-19 pandemic has been an increase in the occurrence and intensity of domestic violence cases in Indiana. Hope Springs Safe House is facing additional challenges in how many people it can safely house, as well as having to forego its annual apple pie fundraiser. On Giving Tuesday, Dec. 1, Alliance Bank surprised four nonprofits with donations of $5,000 each. The organizations were: Benton Community Food and Service Co-op; Boys and Girls Club of White County; Pulaski Human Services; and Prairie Arts Council for its program in the Rensselaer Alternative High School. A related video Megan Lyons (far left), house manager of the Hope Springs Safe House, accepts a bank donation from (left to right) Suzanne Muller, Taylor Luttrell and Jodi Verhoeven of Alliance Bank. In the COVID-19 environment, Hope Springs has faced housing and fundraising challenges. from the bank’s Facebook account is available on the Indiana Bankers Association website at: indiana.bank/commitment-community. Bippus State Bank, Huntington, partnered with GK Baked Goods of Fort Wayne last fall to provide treats to staff members of Huntington County Community School Corp. From mid-October through early December, a Pastry Truck Tour brought free gourmet pastries and freshly brewed coffee to hundreds of teachers and other staff affiliated with Huntington County schools. HB Coffee and pastries are delivered to faculty and staff of the Huntington County Community School Corp. as a show of appreciation from Bippus State Bank.
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