Major U.S. Bank pilots SQN solution
to spot fraud on Treasury Checks
RANCOCAS, N.J., July 17, 2006 – SQN announced the successful completion
of a pilot to read seal protected U.S. Treasury checks at a large financial institution. SENTRY: SealTM
is a robust fraud prevention product providing instantaneous check verification, which supports multiple vendors
including Fiserv Secure Seal, the technology used on Treasury Checks to create image-survivable seals.
SQN is the first vendor taking the Treasury Check validation outside of the Federal Reserve. Every check printed is encoded with an
image-survivable barcode (a "Seal") containing selected data from the face of the check image. SENTRY: Seal decodes and validates any check
protected with the seal technology to ensure maximum protection against altering, copying or forging. When the check is presented, the
financial institution can use SENTRY: Seal to identify any differences between the Seal and the check image.
The successful pilot program which included SQN, the Federal Reserve, the U.S. Treasury and a major U.S. financial institution took
selected Treasury checks presented for payment on a daily basis and ran them through the comparison engine, identifying suspects that
were potentially fraudulent. During the pilot program, thousands of checks per day were examined. Several were detected as fraudulent,
saving a considerable amount of money. The Treasury was the first institution to embrace the Seal technology. They are issuing more
than 200 million seal protected checks per year. SQN decodes, decrypts and validates the information through SENTRY: Seal when the
checks are presented.
"This innovative process provides banks an extra layer of protection against check fraud," said Brian Dunne, vice president of
engineering for SQN. "This new technology shortens the cycle between the bank, the Federal Reserve and the Treasury assuring that
the check is good and that financial institutions will not take a loss from the transaction."
Financial institutions can use SENTRY: Seal at various stages of the check clearing process.
In the back office during Day 2 check processing, SENTRY: Seal reviews the barcode to validate the check.
If a discrepancy is discovered between the Seal and the check image the check is deferred to bank personnel
for further review and payment decisioning. The solution can be quite efficient at the branch teller line
because it instantly detects fraud as it scans the Seal, before the check is cashed.
Charles Costanza, vice president of business development for SQN, said plans are underway to bring the
technology to the teller line. "We are now in the process of proceeding with another pilot which will take
this technology to the next step to the point of presentment for state-of-the-art, Day 1 processing."
About SQN Banking Systems
For more than 20 years, SQN Banking Systems has provided integrated fraud detection and process improvement products for the financial industry,
meeting the needs of financial institutions of all sizes. The SENTRY suite of products includes software for exception item processing, image fraud
detection tools, automated signature comparison, signature verification and display, transaction analysis and safe deposit operations management. More
than 500 SQN customers have improved their earnings and reduced check fraud losses by as much as 84 percent with SENTRY. For more information, visit SQN's
Web site at www.sqnbankingsystems.com.
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