Steinburg helped nab the crooks because of his "gut reaction," he says. But most of his work in the security arena is less glamorous and succeeds because of solid designs. Like many distributors who sell security printing, Steinberg is a proponent of layering features. Yet even checks and other documents loaded with void pantographs, microprinting, artificial watermarks and other security features aren't immune to fraud. Another intangible component often protects customers: the actions of those who work with the documents. Creating a secure document begins with the printed piece, then extends to how those documents are treated by everyone who handles them, from printers to consumers.
Building the Printed Piece
"Security printing is like a pizza," says Ed Boggis, a sales rep with distributorship The Bradley Group, Fairfield, N.J. "You start off with a great crust, and that's the paper." Boggis places paper in four categories, with each category offering more security. First, there's basic basketweave paper such as the stock used for most personal checks. The paper, with a pattern of crossed lines, is widely available in office supply stores, so it's not the effective deterrent it once was. Next, there's safety paper with artificial watermarks. Artificial watermarks are created using white ink or light varnish. Another notch up is security paper with true watermarks. True, or Fourdrinier, watermarks are applied on a dandy roll of a paper machine by pressing an image into the paper while it's still wet. They're more expensive and harder to alter than artificial watermarks. Finally, at the top of the scale is paper with a high rag content, such as currency paper. At minimum, Boggis prefers that customers select paper with true watermarks.
Ken Marks has similar standards. "Without question, special papers [with true watermarks] are not that easy for counterfeiters to obtain," says Marks, vice president of Multi-System Forms Inc., a distributorship in Huntington Station, N.Y. He encourages clients to use watermarked paper. Unfortunately, some don't adhere to the distributor's advice until after disaster strikes.
One of Multi-System's customers, an ad agency, fell victim to fraud. Someone made a color copy of the agency's accounts payable check and cashed it for approximately $50,000. After being burned, the ad agency wanted secure--very secure--checks. The hitch: The agency wanted new checks within 48 hours. Marks designed the checks and faxed the design to a trusted manufacturer, which turned the order around quickly.
Marks delivered 5,000 new checks to the ad agency within 48 hours. The checks were printed on Defensa™ Premium security paper manufactured by MeadWestvaco. The paper includes a true watermark, visible and invisible fibers, and chemical-alteration indicators. The checks also included other features, such as thermochromic ink, microprinting, void pantographs, a warning band and bleed-through numbering.
"I choose the paper first and build on that," says Boggis. For example, Boggis designed and sold "Geoffrey dollars" to Toys 'R' Us for 10 years. (Geoffrey dollars, named for the toy retailer's giraffe mascot, serve as
currency within the stores.) The paper included planchettes, which are small tissue dots resembling confetti that are embedded in the paper. The planchettes were visible in one color, but appeared multicolored when placed under ultraviolet light.
Once Boggis selected the paper, he opted for a secure printing process. To provide the feel of real currency, the Geoffrey dollars were intaglio printed. During this process, an image or design is cut or etched into the surface of the printing plate. When the paper is pressed against the plate, the ink held in the wells transfers to the paper to print the image.
Finally, Geoffrey dollars included several covert and overt features. For instance, the store currency included randomly placed microprinted lines and a rosette image on the left side. The rosette resembled a scroll, but when held at a 45-degree angle under a light, a letter "t" (for toys) appears.
Enhancing the Human Factor
Unfortunately, a document loaded with security features is still vulnerable to fraud. And the weak link in the equation is the one distributors have the least control over--the human element. Still, distributors can take a few precautions to help reduce the odds of fraud. "Take care in how documents are printed, how they're shipped, where they're stored and how they're reconciled," Boggis says.
The first step is to select the right manufacturer. "The plant needs to be a secure facility, not just a padlocked plant," Boggis says. For instance, consider working with a manufacturer that prints security documents in a separate, secure part of the facility rather than on presses side-by-side with other presses. In addition, look for vendors that carefully inspect documents. Press operators who printed Geoffrey dollars thumbed through the finished documents, which were printed 24 to a page. If the dollars were flawed, operators destroyed and discarded them.
Manufacturers also should maintain accurate job histories, documenting who worked on the job and at what point. "If, God forbid, you had a problem, you could resurrect the job information," Boggis says. After printing, shipping is the next issue. How secure are your delivery trucks or the local delivery methods you use? For highly sensitive jobs, Boggis has relied on vaulted trucks, such as those used by banks for money deliveries.
Once customers receive security documents, most distributors consider their jobs done. But savvy distributors educate clients, providing advice on how to store and use security documents. "Encourage customers to handle them with integrity," Boggis says. "Tell them, 'Don't take these checks and store them next to your invoices.'" Help clients set up secure storage areas.
If you sell checks, offer two suggestions for reducing fraud--regular account reconciliation and positive pay. "There are an amazing number of companies--large and small--that don't reconcile their checking accounts," Steinberg says. He estimates about 25 percent of companies neglect this important task. These lax companies assume there's always money in the bank, so they don't bother with the tedious task of reconciling each check, Steinberg says. But this makes them easy prey for criminals.
Positive pay, a check-matching service offered by some banks, often catches counterfeit checks. Companies send banks electronic files listing the checks they issue. The banks match the checks (as they are cleared through the item processing area) to the files. In addition to flagging counterfeit checks, the system can alert businesses to altered dollar amounts on checks.
Finally, distributors can help customers by teaching those who receive documents, such as bank tellers and cashiers, how to identify authentic documents. When Boggis supplied gift certificates to a retailer, he led a training session for cashiers and managers. During the session, he displayed a chart that included a sample certificate and examples of how it could be altered. The retailer ordered several charts and placed them at cash registers to guide employees.
Susan Keen Flynn is a freelance writer in Cleveland and a frequent contributor to Print Solutions. Email us your comments at bholt@printsolutionsmag.com.
Thanks to The Flesh Company, based in St. Louis, for assistance.
5 Tips for Marketing Security Documents
1. Deter fraud with a warning. "When you're putting in features, state them in a warning band," says Ken Marks, vice president of Multi-System Forms Inc., a distributorship in Huntington Station, N.Y. "Just like car theft, if a criminal sees all these deterrents, he'll move on to an easier target."
2. Protect against piracy. "The biggest problem today isn't counterfeiting, it's pirating," says Ed Boggis, a sales rep with distributorship The Bradley Group, Fairfield, N.J. He cites the rampant trade in everything from knock-offs of famous handbags to bogus Beanie Babies®. To protect consumers against the latter, Boggis supplied 1ˇ4 x 1-inch loop tags with holograms to signify authenticity of the stuffed animals.
3. Select features that fit the application.
"Documents need different grades of protection depending on their exposure," Boggis says. For example, he says, fewer people handle payroll checks, so those checks might not require as many features as accounts payable checks. Although he recommends layering features, Boggis admits you can go overboard. He recalls a hotel that was a victim of fraud: It requested certificates with all the available security features even though it was ordering only 179 of the certificates for a barter program.
4. Consider the environment. Only include features that can be verified by people receiving the documents. For instance, if cashiers don't have UV lights, don't add photochromic or fluorescent ink to gift certificates. Similarly, while coin reactive inks are an option, they're useful only if the person receiving the document can scratch it with a metal object to reveal the black ink.
5. Tout your expertise. To gain exposure and position himself as a security documents expert, Mike Steinberg, president of Dover, N.H., distributorship Relyco Sales Inc., has made presentations on security documents at American Payroll Association meetings.
A Triad of Troubles to Overcome
One benefit of marketing security documents is a limitless prospect pool. "Every type of company uses them--everyone who writes a check," says Mike Steinberg, president of Relyco Sales Inc., a distributorship in Dover, N.H. Turning these prospects into customers, however, isn't easy. Among the challenges of selling security documents are three thorny issues:
1. The electronic enemy. "Technology has had a major negative impact on security printers," says Ed Boggis, a sales rep with distributorship The Bradley Group, Fairfield, N.J. Boggis has sold security documents for 26 years. Stock certificates and promissory notes once accounted for a huge part of his business. Timely printing of these secure documents was critical because "to lose a day's interest was to lose a fortune," he says. Now, much of this work is done electronically.
Ken Marks, vice president of Multi-System Forms Inc., a distributorship in Huntington Station, N.Y., also has lost check business because of technology. Consumers and companies who pay bills electronically no longer rely on paper checks. "That I have no defense against," he says.
2. Corporate penny-pinching. "Today in corporate America, the way employees keep their jobs is to buy cheap," Boggis says. "Unfortunately, if they buy cheap, they get what they pay for." Most manufacturers offer some security features free, but charge for others. During tough economic times, convincing clients the extra fee is worthwhile can be difficult. "It's a catch-22," Marks says. "People often know they need the features, but they don't want to pay for them." The challenge for distributors? Convince clients that "you may pay 10 percent more, but that's better than being taken for $10,000 by a criminal," Marks says.
3. Design requirements. Banks want to scan
checks, and the postal service needs to mail them. Creating secure checks that
are image-ready and machine-readable through window envelopes is formidable,
Steinberg says. For instance, checks with step-and-repeat backgrounds may not
reflect enough for postal equipment to read them. And a security border must
steer clear of the MICR clear-band area dictated by ANSI's standards on
image-readiness. (For more information on ANSI's standards on check backgrounds,
which were revised in 1999, visit www.PSDA.org and click on the "Publications" link. Click on the Business Printing Technologies Report icon, and read the August 2000 issue. You must be a DMIA member to access the information.)
