Protect Your Business from Scams
04/03/2024
Protect Your Business from Scams
There are so many different types of fraud, and scammers are constantly trying to attack small business owners. Protect your business and its reputation with the following tips!
Types of Scams
Fake Invoices and Unordered Merchandise Scammers will send invoices to businesses for things they never purchased in the hopes that an unwitting employee will pay the invoice. Or scammers will send unsolicited merchandise to businesses and then exert intense pressure on the businesses to pay for the items.
Utilities Impersonation Scams Scammers will impersonate a utility company and demand payment for overdue bills or equipment upgrades.
Government Impersonation Scams Scammers will impersonate government agencies such as State compliance agencies, the IRS, or Federal oversight agencies. They will threaten to suspend licenses, take immediate legal action, or levy fines.
Tech Support Scams These scammers will usually rely on security pop-ups to begin contact with employees. These pop-ups will usually include a phone number or link to phony tech support services. They will ask for payment for these fake services or steal sensitive information by gaining access to your business’s devices.
Phishing Email phishing attacks on businesses are extremely common. Scammers may spoof company emails and impersonate an employee to get real employees to click on malware links or provide sensitive information. They may also pretend to be entities your business interacts with frequently, such as banks or utility companies.
Tactics
There are tell-tale tactics that can help your business easily identify a scam. According to the Federal Trade Commission (FTC), common scam tactics include:
- Impersonation of a person or entity your business and employees will trust.
- Creation of a sense of urgency and fear to get someone to act without verifying all the details.
- Specification of non-traditional ways to pay. While some scammers will rely on you paying via normal channels like checks for phony invoices, others will specify payment via cryptocurrency, gift card, or wire.
Ways to Avoid
One of the best ways to avoid business scams is to educate yourself and employees. Training and education can mitigate many of the trouble scammers can cause. Train employees to double-check any invoices or merchandise they receive. Establish checks and balances for paying invoices. You can also implement procedures for new vendors and subcontractors that employees must follow.
Another way to protect your business from scams is to safeguard your computer systems. Have strict protocols in place for employee passwords, computer usage, and access to sensitive information. Make sure employees report any phishing attempts to those who can post a company-wide alert and be sure to share clear instructions for reporting any possible security breaches.
Protecting your business from scams is an important step in safeguarding your assets and your reputation. Many government agencies like your state Department of Commerce, the Federal Trade Commission, and the Small Business Administration offer resources for businesses to help them avoid fraud.
Sources:
https://www.ftc.gov/business-guidance/resources/scams-your-small-business-guide-business
https://www.nationwide.com/lc/resources/small-business/articles/business-fraud-prevention