Critical Alert: Fraudsters posing as new clients are using large ACH deposits to open accounts and then requesting immediate withdrawals before the funds clear.
Common Scenario: A prospect contacts a financial advisor out of the blue. Often it is a result of an internet search, not a referral. An account (could be brokerage or advisory) is opened with the financial professional using fake or stolen identities. The account is opened with a large ACH deposit and then immediately the funds are requested to be sent out to a different bank account.
As a result of this fraud pattern, Cetera has decided to implement a 60-business day hold, effective immediately for those that meet the following criteria:
- Large ACH Deposits over $100,000
- New accounts with no previous Cetera engagement.
Product sponsors may have their own holding requirements per their policies.
Alternatives to large ACH deposits include wire transfers and Push ACH. Wire transfers are available as soon as funds are received and processed.
Please watch this short video from Joe Neary about the new policy and approach to ACHs in and out for new clients. It is important that we understand and prevent potential fraud surrounding this activity:
https://players.brightcove.net/4144709335001/default_default/index.html?videoId=6390884322112
Learn how this scheme works, the red flags to watch for, and what steps to take if something feels off:
Article:https://advisor.adviceworks.net/articles/detail/D08013069
If you have any questions, please contact our compliance team at compliance@prosperityadvisors.com or email compaml@cetera.com
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