If I were to ask if your money is safer in a box on your back porch or in the bank, you would most likely say the bank and give me an eye roll.

Well, I would push back and say, no, your back porch is! Well, unless you have put in place what very few people and businesses know about. After all, I have never had anything stolen from my house, my yard, my car, etc. However, last month our company had money stolen out of our business bank account and get this, there was nothing we could do! Worse yet, we knew who did it, and even then, we would have to take them to court to get the money back. If they stole it off the porch, we could call the police. But with the bank, we would have to spend money to take them to court. Also, they know if they take around a thousand dollars or even two or three thousand, it costs more to get it back than just letting them keep it.

As a business, you only have 24 hours to notify the bank that money was stolen from your account. On a personal account, you only have 60 days (these are new rules that went into effect back in 2021). After that, you have zero recourse other than suing the person or company that took the money.

It gets worse. Everyone knows about stolen identity. Well, these crooks are getting smarter and know that the easiest way to steal is by taking money out of bank accounts and then closing out the account and walking away. This means there is no way to go back and sue them because they don’t exist.

Yes, it does get even worse! You might be thinking, thank God no one has my banking account and routing number. Well, just look at your check number, and let’s say it is 5001. That means five thousand people have your bank account and routing number, and that does not include any business that you gave your ACH info to. Again, you may think a business won’t steal. First of all, I know that in our industry, most of our competition has a website, which gives many people a false sense of security. However, If you start looking for the ownership of that company, you may be surprised that not one owner is listed. Under the “about us” section, it’s just a made-up mission statement or some other little cute saying. They have a website today and will be gone tomorrow. But again, even if they are a real company, your only recourse is to sue them for money taken out of your bank account.

No worries, there is a happy ending or at least a somewhat happy ending. Like most businesses, we keep a fair amount in the bank to cover payroll, money owed to vendors, etc. After we were robbed and told we only had 24 hours to catch it, I asked my team to look for other options. There is no way this is ok, and there is no way the large global companies that bank millions would let themselves be vulnerable to this risk.

After finding no options, we went back to the bank, and they told us about a product they have called “Positive Pay.” Now, I am not promoting the bank or this product. Not at all! Yes, we signed up for it, but at gunpoint. They gave us two options.

They are using our money for free; then they charge us to let them do that. Now, they want to charge us more to protect our money. So, does money in the bank imply it’s safe? That would be NO!!!

I guess I should not be surprised. After all, our firm audits credit card processors and banks for overbilling credit card processing fees, and the typical overbilling is about 40%. For large corporations, that adds up to over $10 million a year, and for even small companies, it is in the tens of thousands. So if they will do that, then this really shouldn’t surprise me. I guess I’m like our clients who say are you kidding me? They did what? I guess this also explains the skyscrapers, their yachts, private planes, etc.

For total transparency, I was a commercial bank executive for over a decade. Being a speaker and author, I get interviewed a fair amount, and I always say the same thing –

Check with your bank and see what product or service they offer. Also, don’t forget to get your merchant processing fees audited. I have to wonder, what else are they doing to rob businesses blind?

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Do you have “Risk Fees” on your credit card  processing statement? No? Well, that’s good! You are lucky (make sure you keep reading if you do), but have you gotten an audit to ensure you don’t have one of the other hidden fees? Did you verify your statement to ensure that your credit card processing interchange fees are not being inflated? Due to the lack of regulation, credit card processors can inflate fees, makeup fees, etc. Over 95% of all merchants are getting overbilled. The worst part is that merchants give credit card processors 100% full access to their business bank account and never validate the fees they take out. They think merchant processing is regulated.

Below is what Senator Dick Durbin said on the Senate Floor on September 27, 2011:

Watch the video

The government knows that credit card processors are taking advantage of merchants, but they refuse to intervene. There have been many class action lawsuits where credit card processors have settled. Yet, most merchants still give them full unchecked access to their business bank accounts. We find that the average merchant is getting overbilled by 40% or more. Think about that – for every $10,000 credit card processors are taking out of your bank account, it should only be closer to $6,000.

Back to one of many ways processors over-bill merchants is a thing they call “RISK FEES.”

I could go into a lot of detail on this, but much of it would be lost on most readers due to the abundance of industry jargon. People who work for a credit card processor are like politicians in training. Ask them why something was taken out of your bank account, and they will talk and talk and talk until you are sorry you asked and probably forgot what you asked.

So here is the short answer – we have only seen one credit card processor and a few ISO’s (Independent Sales Organizations) who resell credit card processing charge a “RISK FEE.” So the question is if this is a legitimate fee, why isn’t every credit card processor and ISO charging a “RISK FEE”?

We have seen “RISK FEES” as high as almost 1% – that’s almost 100 basis points. To put this into perspective, a merchant should be paying a credit card processor a “Discount Rate” of only 5 basis points (.05% or .005) or less. But if you factor in a 1% RISK FEE, your true “Discount Rate is now 105 basis points or 1.05%

Again, “RISK FEES” are just one way a credit card processor can overbill a merchant. I wish credit card processors spent their money on how to make credit card processing safer and cut down fraud, but it seems like they spend all their time on how to come up with new and creative ways to hide and inflate fees.

Whether you have “RISK FEES” or not, you should take advantage of getting a free audit to see if you are getting overbilled and if your statement is full of hidden, inflated, and made-up fees.

I know when someone says FREE, you automatically say what’s the catch?

The catch is like when the big box grocers give you the free cookie in hopes you will want to buy the whole bag once you see how good it is. We hope after you see for free what we can do, that you will want to use our paid services. But to be clear, there is no credit card or anything to try us out. Like the free cookie, if you don’t like it, you are free to keep walking.

But also, to be transparent, over 99% of our clients stay with us. Even our very first client from over 14 years ago still loves us today as much as they did 14 years ago.

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