“LBM Talks” hosts top professionals from different sectors of the lumber and building material industry to share their expertise, with a heavy emphasis on practical, tactical strategies to help you serve your markets and grow your business.
Join LBM Talks host, Thea Dudley, as she brings her razor-sharp expertise to dissect trends, regulatory changes, and offers real-world advice for credit professionals. In this episode, Thea is joined by Janet Hammel, VP/Deposit Operations at ProFed Credit Union. Janet and Thea met at LBM Strategies 2024 where she was accompanying her husband who works for Morsches Builders Mart. With Janet’s unique connections to both credit and the LBM industry, Thea insisted she join her on the podcast.
Janet shares advice on protecting your business from fraud. She shares that there is not one action you can take, but many proactive measures to make your business difficult to steal from. Learn more by listening to the full episode.
Janet and Thea will be taking this subject even deeper in an upcoming webinar on March 25. This webinar is free for qualified LBM pros. To get alerts on upcoming webinars, sign up for our newsletter here.
Mentioned resource: https://www.ftc.gov
Please send any inquiries to thea@creditoverlord.com.
Prefer to read about it instead? Take a peek at the transcript below for Episode 14: Fraud Prevention with Janet Hammel.
(Editor’s note: Transcript is AI-generated and may include some errors.)
Thea
Thea, Hey there. I’m Thea Dudley, also known as the credit overlord. And welcome to LBM talks credit. We are the only podcast that talks trade credit in the lumber and building material space. Never miss an episode. Stay tuned, and we’re glad you’re here. You Thea, Hey everybody. Welcome to another edition of LBM talks credit I am Thea Dudley, your host, also known as the credit Overlord, and we have got an amazing episode for you today. I am so excited to have this guest on with us, because we’re talking about one of my favorite topics, not by choice, but because it seems to be just everywhere you look fraud, we have talked about check fraud, ACH fraud, credit card fraud, and we’re just going to wrap all of those up and throw in a couple of things maybe you haven’t heard of, and maybe some things you could do to straighten it out. So please give all your full attention a very warm welcome. Janet Hamel, I am so excited that you’re here with us today.
Janet
Well, thank you very much. Thea, I was very happy to come on and give you the insider information. Again. My name is Janet Hamel, I have a unique piece into this industry, because my husband works for Morse builders Mart, as you can see, and he has worked for them for over 30 years. And so from my experience from the credit union world and his experience from the lumber industry, it gives a unique experience that we can give and go over the different information that can help everyone with fraud prevention.
Thea
Well, poor Janet, I met her at the LBM strategies conference last year in 2024 and you know, she was there with her husband, and we’re standing around talking. I asked, Hey, you know, what do you do? And she said, Well, I’m in banking, and we got to talking about fraud, and then I think I stalked her for the rest of the conference, and I just, I think I look pitiful enough that I’m like, Oh my gosh, you have so much good information. You need to come on and talk to the LBM credit community, because this is a huge thing for us. So not only do we have Janet for an episode of LBM talks credit podcast, but she will be with us in March for our webinar, and we’re going to be going over some more specific things and allow you to get some questions into us so that we can address whatever is going on out there. But let’s jump in right, right out of the gate, check fraud came back with such a vengeance. You know, that old school stealing it out of the mailbox, the drop box, you know, kind of wherever. And I love the post office, where they’re like, oh, it’s, you know, there’s nothing to see here. There’s no fraud here. It’s like, Yeah, honey, you too. There’s, you know, we’ve got some bad actors in there, and we talked about that in a previous episode. But now you’ve also got, in addition to the check washing, they’re selling it on the dark web. But now there’s ACH fraud. Credit card fraud has ramped up quite a bit. But you know, Janet, can you talk to the ACH fraud? Because that’s something that I think people are just getting the opportunity to experience.
Janet
So with ACH fraud, honestly, everything on the bottom of a check is the same information for Ach, so it’s your routing number, your account number, and if you’re not paying attention to your balances, your accounts, what’s going on through your corporate clearing houses, you’re going to lose money just like that. So yes, there are time frames that you can, with your financial institutions, go in and dispute your transactions, and that’s super important, because there are rules and regulations with that, and you do have a time frame, so it’s super important. Just like with checks, you balance your checkbook, you’re going to balance your register, you’re going to balance your ACH transactions, there are faster payments that are coming through. Now, unfortunately, those faster payment options do not have the same fraud protection as ACH. Even though ACH is getting is coming the fraud with ACH is coming up.
Thea
Oh, you know, it just feels like every time you turn around, there’s something else for a business to be stressed out about or have to look into. So when you talk about faster payment methods, because we’re really it’s such an instant gratification world. Everybody wants their money. It’s just like anything. I was so upset during the pandemic when Amazon Prime was like, not two hour delivery anymore, and there it’s like, next day, what am I an animal? When am I can’t wait for my package? So now you’re, you’re talking about, you know, we were, we went to portals, we went to, like, instapay, Zelle, money, all of this other stuff to get our money quicker. And now we’re finding out, well, it is quicker, but there’s some repercussions. But no matter what you do, there’s that opportunity. So in your opinion, what is. The best thing that somebody can do to help limit regardless of what type of fraud it is, what is some of the best things they can do?
Janet
So there’s not, I’ll be honest, there’s not one, one thing that you can do. I know, I know. I wish it was, or everybody would be doing it. That’s why the fraudsters are getting away with what they’re getting away with. They’re making you have to make yourself and your business hard to get to. We call it in the industry a hard target. You’re basically making it difficult for them to take money from you. So by putting in like, making sure that you they can’t get into your network, into your electronic transactions, they that you, if you’re paying checks outbound, that you get some sort of service, like positive pay or something of that nature. So your checks can only clear for what you’ve written them for, so they’re not washing them and changing the dollar amounts. So it’s, it’s this layered approach, just like you and you, you risk assess all of your financial process, just like you risk assess your drivers, your any other processes that you have in your industry. Because it’s a layered you have to set your layers, and it’s all these pieces, but you have to sit down and think like a criminal and go, Okay, how can you get in? How can you take my money. But it takes all of us doing it. We all have to do it because, honestly, the financial industries, they’re overloaded the and I know you all have felt this. You get a bad check. You take it to your prosecutor’s office, and half, half the time, it has to be such $1 amount or they’re not even going to touch it, because, guess what? They’re running after killers and all these other people that have done really, really bad things. They’re like, it’s a bad check, but it’s our money, like, so, right?
Thea
I mean, it’s our money. I’ve had that experience where the, you know, the the prosecutors, like, ah, Thea, you know, they’re like, it’s not really enough. I’m like, it’s a $30,000 check. Well, you know, it’s white collar crime. It’s like, okay, but it’s, it’s still crime, and it’s $30,000 so to me, it is a lot of money. And like you said, they’re going after, you know, murderers and all this other but it just feels counterintuitive that you have laws and it’s like, yeah, we’re just, we’re just going to be cool with it. No.
Janet
So that’s why the layered approach works, and that’s why looking into those processes and making sure that you’re watching your own process and knowing okay if you take it to the prosecutor’s office, and being proactive with the prosecutor’s office and going, okay, so what will it take for you to prosecute someone that has a bad check? For example, locally, they have to have a driver’s license information on it. They have to have more documentation involved with the transaction, so you have to be proactive to make sure that you can get help. When something does happen to you, I say when, not if.
Thea
I love that you said when, because that’s the other thing I hear a lot is, well, I know you keep talking about fraud Thea, but it hasn’t really happened to us. It’s like, Oh, honey, it’s come into a neighborhood near you. It is a matter of time. I know that the East Coast and the West Coast tend to get it before everybody else, and then it starts moving in, and before you know it, nobody’s safe. You’re just not. It’s it happens just with your credit cards at home, or you’ll look at a charge. It’s like, I didn’t buy this. I would never buy something for $1 or $2 on my credit card. They’re doing that ping test to see if you’ll catch it correct.
Janet
And honestly, most citizens of the United States have had their information stolen, and it more than one in four because of how many breaches have happened, and so if you haven’t been proactive, you as an individual, haven’t been proactive to protect your own information, you’re just making yourself more of a target. Now, when you go to your business, the executives in the in the industry have to be more cautious, because you are a target for what’s called business email compromise, and that is your email, or someone trying to spoof your email and doing transactions that that people think they’re coming from you, but they’re really not coming from you, or they’re going to send you malware, because you are the face of the industry. You are the face of your company, so they’re going to do those types of things to see if they can get into your company, or your electronic system at your at your place of business, because of you. So it, it’s one, again, a layered approach, and all kinds of, if you don’t have an IT professional that helps you, please find one.
Thea
There’s lots of say that, though, too Janet, because it is a big deal. And, you know, we, I’ve had a credit person call me and they’re like, Hey, we had some of this going on. I’m like, Well, what are you doing for cyber security? What education are you doing with your your internal folks? Like, well, we tell people to be vigilant. It’s like, that’s like saying here, don’t put the top back on your beer when you’re driving. It’s that’s not really helpful. Um. That cyber security is such a big deal. And even with cyber security, some stuff gets through. I mean, there’s, there’s all kinds of things that I’m almost afraid to click on, anything from anyone I don’t know, because of that.
Janet
You’re very, very accurate. There are even emails when I get from people I’m like, I’m going to call them first from an outside number before I go clicking on that thing, because it happens. I mean, you’d be surprised. I mean, honestly, if you don’t know someone that hasn’t had their email hacked, that’s amazing, really amazing. But it’s those little things that part of your and I call it a risk assessment, because that’s really what it is just like you’re looking at a new a new customer. You’re taking their credit, you’re looking at their credit application. That’s a risk assessment for that customer. You’re going to do a risk assessment for your whole entire business, as far as how easy it is to defraud you, whether it is through the paper, through electronic, through your cyber walking into your business and plugging something into a computer. There’s all kinds of ways it is so scary, but it is there, and you were completely right when you say it comes from the from the coasts and comes in, however, we’re all connected with computers.
Thea
That’s true. It has to be from anywhere in the world seriously, correct, correct. And you know, the I think the thing that is really overwhelming to think about is you have to think of it as a two fold, because you had touched on payments going out in credit. We always think about what’s coming to us or what’s not making it here. And how can I help my customers, because I know this is such a problem, but it’s also the money that we’re sending out. As a company you’ve got, you talked about positive pay as one of the things that you can do to help prevent that, but if you’re, I know companies that are like, no, no, I’ve got to write a check. I really want that. You know? I want that almost like a, like a, cya, I’ve got to have that paper trail. It’s like, what, what really, you did? You think grocery stores, a lot of stores won’t even like Target, I think stop taking checks in July of last year, and Whole Foods doesn’t do it anymore. And there’s, there’s several other companies that they’re like, we’re just not doing checks anymore. It’s just too much. It’s, it’s, there’s too much risk, there’s too much fraud, there’s too much NSF. They’re just not doing it.
Janet
And it’s a honestly, it takes a lot of time, because you have to buy your check stock. That costs money. You have to print them. You have to have somebody on your side take care of the transactions. They have to have somebody on their side taking their transactions. A lot of times, you’ll get a discount for electronic transactions depending on how what type of bulk situation you’re dealing with. I just checks like I said, the bottom of the check has all your account information on it. So if that check is less in the mail and somebody else grabs a hold of it, check the news, there was post men that were getting stabbed and their keys were being taken so that they could get a hold of the everything in the blue box. So don’t take, don’t put your mail in the blue box.
Thea
I mean, the stuff that happens just Google, you’ll see some students know that. You know, you start Googling that, and it’s like a rabbit hole. You go down, it’s like a vortex, and then pretty soon, you’re like, I’m just going to start paying people in turquoise beads and otter pelts. Because this is, this is insane, yes, but the fact that stores are moving away from that, and I’m I understand why businesses are like, look, I still want to take checks because credit cards are so expensive, and we’ve had that conversation about the cost of money, and what if you have to go back? And, you know, I have one business that they had almost half a million dollars stolen from them, and it took two years to claw all but 18,000 back, but it was over 1000 man hours, and that’s where, until it happens to you. On a scale, it’s not really quite as impactful, but even if you get one check stolen, you’re vulnerable. And what have you done for it? So Janet, what are some things positive if you’re if you’re paying checks out, moving to a positive pay, reaching out to your bank to say, hey, what? What do you have to offer? What can we do?
Janet
That is a big thing, making sure that you have a wonderful connection with your financial institution. Now, there’s options out there. Now, I have talked to different people about the industry. I have been in the credit union industry for 28 years, and so I’m partial.
Thea
Smaller banks are so nothing against wells, Fargo or any of the big nine, but, but I equate them to like a Home Depot or a Lowe’s. That’s the type of service you’re going to get where if I go into one of my independent lumber yards. It’s like a credit union I’m or a local small bank, I’m going to get a much different banking experience, and I tend to get a little bit more empathy. I know going to, you know, some of the larger banks and and saying, Hey, this check was stolen. And they’re like, Well, it’s a bummer. You have people in your company stealing I’m like, Well, I would love for a people here to be that smart. It never made it here. We didn’t get a chance to steal it, because it didn’t make it to us. And you have to get your customer to go in and, you know, file the complaint and file the paperwork and ask for an investigation and and I think some of those larger banks get hit with so much of that that their empathy level is just non existent, not everybody, but as a whole. And it’s, it’s nice to be able to go, you know, walk in and have them go, Hey, Thea, it’s like, have issues help me well.
Janet
And a lot of times your local branch will do a lot for you, but their hands are tied sometimes too. So you need to have be proactive again and and have these conversations before something happens. Know what your options are, know what you’re supposed to be doing, know where your risks are. That knowledge is power, right? We’ve all heard about that, and so knowing okay, if you had this type of fraud, if you’ve had this type of fraud, we’re the experts. We’re going to know what, what type of products and services you’re using for your type of business. And so then we can assist you in saying, Okay, well, with your credit card portfolio, we would suggest this, or we would suggest that with your with your with your cards, definitely subject, you know, separate your payroll versus your accounts payable. Or, you know, do this versus do that. So then if something happens to this account, you have this one covered. You know, it is a conversation. That’s what we’re here for, that that’s what that relationship is supposed to do for you. But I feel for the big banks and the big guys, because they’re not they can’t put the extra money into it because they’re so large. But I’m telling you, they get we put a lot of effort into it. We do a lot of running around, because there’s people just like me and counterparts all over the United States that are doing everything that we can to stop the fraud. And the only way we will stop it is if everyone works on it together, whether it’s in the industry, in the financial industry, or individuals themselves doing what they can to stop the fraudsters.
Thea
Well, what I love about what you just said is, I heard free resource because we’re all about, what can we leverage? What can we do? So as a business, you probably have a relationship with your bank. That’s a great starting point is, what can we do? What do you recommend? What do you suggest? And then, if you’re working with a payment portal company, you know, hey, what do you guys do? What? What else can we do to beef this up? Do we have an IT person that? And I know a lot of times you have an IT person that’s like, well, they’re it and they’re also HR, so depending on what day it is, the different hat is on. I get it came from a family business, and that’s everybody had some multiple hats, but it, it would be advisable to bring in a cyber security expert, even if you just bring them in, to do an assessment of where your gaps and pain points are, so that you do learn. And there’s a lot of companies out there that’ll do that, I think, I think it’s SC archetype is one that’s here in Myrtle Beach that they do a lot of, a lot of that risk assessment and getting all of that lined up to be able, like, you say, those layers. It’s like getting dressed for cold weather. You start, you know, just layering up. But I heard free, and I’ve just got really excited about that.
Janet
Yes, because they want your business as a financial institution, we want the business, and so it is in our best interest as a financial institution to do what we can to and we want to stop the fraud as well. So we want to give you the information beforehand, because it only helps us, too, and then it creates a better environment and just a better relationship and but again, it all is specific for each company, because each company, depending on what your state laws are, depending on where you know, what size and what different vendors you’re using, and they might have different suggestions, because some institutions have different fraud monitoring programs than others.
Thea
And so why do you think some companies are so and we started to go down this rabbit hole, and we got sidetracked somewhere else. But why are some companies still so enamored with I have to write a check, and I want to put it in the mail. I had one company that their check was stolen, and then they said, we’ll put it a replacement. I’m like, Well, here’s the portal. No, we’ll put it in the mail. Um, did we not see this show before you? Why would you do that?
Janet
They fear change. I really do. Feel that there’s, there’s so much change out there. And 2020, changed so much of our lives, and it really taught a lot of us to embrace it and really learn about how to do things differently. I mean, really, how many people get to work from home now that never got the opportunity? I’m in the Midwest, so today, it’s, I think, five degrees outside today. And I know it’s great, but kids never got to go to school from home before 2020 and so now they can do that when the snow gets you know.
Thea
They don’t get a snow day anymore. It’s like, Oh, I know we’re gonna go, it’s like 2020, record snow days for kids, because now you’re like, Oh, baby, log in. You’re gonna be fine, correct?
Janet
Sorry, sorry, but that’s what it is. It’s, you know, they they don’t want to learn anything new. It’s and, and I love that to a point where it works. It’s covering what they do. They know how it works, and it is scary to learn something different, but that’s what we have to do as financial institutions to help teach the new things and how it can’t be scary and that there are new things out there. And that’s, again, that relationship with with your business, but it also is something where as maybe the journal can do what they can to say, Hey, these are different payment options. And, I mean, I know we talk at home a lot about a lot of different things that come up, and I know one thing that come up was credit card interchange. Oh, does that?
Thea
That’s a conversation that happens so, you know, and it happens every time any finance people get together. It doesn’t matter. You know who it is and and I know they’re high and I it’s not that I’m in love with the credit card it’s it gives me a different now, not that there’s not credit card fraud, that’s a whole other topic, but it there’s a difference there, where at least I have the money immediately I’ve got, you know, I’ve got it into my system, and I don’t have to worry about that other shoe dropping. And if I’ve set up my system correctly, especially if you’re working with portals, whether it’s through a bank or through a software service, you can set up to have that fraud alert. You know, they’ll pick up a lot of times on fraudulent activity, and they’ll deny the card. I love when someone doubles down and goes, well, I’ll give you a different one. It’s like, I don’t think I want your different one. I kind of saw that coming already. It’s like, we’re not playing credit card roulette here. You just pick the one that goes through. But I know that those rates are high, there are things you can do to bring them down, but at some point it’s you have to do the ROI on the cost of doing business. If the check takes me this long, if it takes two weeks, or it never gets there, and it has to be replaced. And now we’re at a month out or longer, because a lot of times a smaller businesses don’t have the capital to go. Well, I’ll write you another one while I’m waiting for this investigation and seeing if I can get claw this money back. They just they don’t have it.
Janet
And those investigations there, there are little checks. All the regulations with each one of these payment options are different. So checks have different time frames, versus credit cards versus ACH versus, I mean, all of them, they’re separate and they’re different, and so that’s why Knowledge is power again, having that conversation with your financial institution and understanding what will work for your business model, and having that risk assessment again, and having a chance to go over the different processes and what you feel works well for your company, in your state, in your area. It’s just a big picture type process.
Thea
It’s so frustrating because you hear what I get out of it is it’s a lot like lean law. It’s such a state driven type of thing. So I am so excited that you’re going to be back with us in March, and we’re going to be doing a webinar where we can talk about specific things to ask about in a risk assessment, what you should be looking for, how you can approach it. You Janet, I can’t thank you enough for being with us. We, this community will just eat this up because we’re, you know, we’re, we really want to stop it. We really want to protect, you know, it’s, it’s so hard to get those, those sales and to eke out that profit that you’re like, I don’t want to share it with some guy who is a really good thief, but if you could, could you just focus on using your powers for good and stop fighting me? Right?
Janet
We don’t need Nigeria to get any more of our money. I mean, they’re a great place, but correct? I mean, we’re working hard for what we have. Yes, yes.
Thea
Well, I don’t know if I get one more, like deposed Prince of, you know, some nation of, you know of Zamunda, and you know, he wants to send me $3 million if I could just give him my bank account so he could launder. For me, I’m like, okay, that’s someone. Someone must still be falling for these, because they’re still doing them, correct?
Janet
Okay, I’m telling you the stuff that you can find, but I will tell you, the Federal Trade Commission has one of the best areas for information. It’s the ftc.gov, and they give great information to businesses on business email compromise that is a big one, and it attacks all, every industry, health care, financial institutions, you know, the lumber industry, everyone. It hits them hard, and that’s money out of everyone’s pocket.
Thea
Well, I know when we will put a link to the the FTC website, I’ll have Sally put that in there. The other thing that has come up is that, you know, construction is one of the industries, like you said, That’s hardest hit because we deal. We do still use checks so much where it’s it almost works against us. Yes. Yay. Go us. Well, Janet, thank you. Thank you, and thank your husband for allowing us to use his office. Yeah, so today, poor guy, it’s like, go walk the yard. You’ll be fine. Go see if the trucks are back yet. Go load something. But we thank you for being here. Can’t wait to talk to you again in March. And for everybody that’s hung out with us, thanks again for another episode of LBM talks credit. You can find us every other Tuesday on Apple, Spotify, Amazon, you name it. And if you haven’t heard yet, my new book, credit overlord credit Unleashed was released Friday before last, and it’s available on Amazon, so please check it out again. Thank you, Janet, for joining us. Thanks LBM community for being with us, and we’ll catch you in another couple weeks. And until then, we hope you’re serious about your business, because we are.
