Business owners tips: How to Protect Your Business from Fraud and Scams?

Business owners tips: How to Protect Your Business from Fraud and Scams? 

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By Taz Rajan | Reading time: 5 minutes, 31 seconds | 1050 words

Businesses are being targeted for fraud and falling victim to sophisticated scams. We shared the top 5 scams that target businesses and now, let’s take a look at how you can protect your business.  Action cures fear and is the best defense.  Use these tips to leap into action protecting your business and future.  

  1. Train Your Employees 

  • Your best defense is an informed workforce. Explain to your staff how scams happen  

  • Encourage people to talk with their coworkers if they spot a scam. Scammers often target multiple people in an organization, so an alert from one employee about a scam can help prevent others from being deceived. 

  • Train employees not to send passwords or sensitive information by email, even if the email seems to come from a manager. Then stick with the program — don’t ever ask for sensitive data from employees by email. 

 

  1. Verify Invoices and Payments 

  • Check all invoices closely. Never pay unless you know the bill is for items that were actually ordered and delivered. Tell your staff to do the same. 

  • Make sure procedures are clear for approving invoices or expenditures. To reduce the risk of a costly mistake, limit the number of people who are authorized to place orders and pay invoices. Review your procedures to make sure major spending can’t be triggered by an unexpected call, email, or invoice. 

  • Pay attention to how someone asks you to pay. Tell your staff to do the same. If you are asked to pay with a e-transfer or wire transfer, reloadable card, or gift card, you can bet it’s a scam. 

 

  1. Be Tech-Savvy 

  • Don’t believe your caller ID. Imposters often fake caller ID information so you’ll be more likely to believe them when they claim to be a government agency or a vendor you trust. 

  • Remember that legitimate email addresses and websites are easy for scammers to fake. Stop and think about whether it could be a scam before you click. Scammers can even hack into the social media accounts of people you trust and send you messages that appear to be from them. Don’t open attachments or download files from unexpected emails; they may have viruses that can harm your computer. 

  • Secure your organization’s files, passwords, and financial information. For more information about protecting your small business or non-profit organization’s computer system.  

 

  1. Know Who You’re Dealing With 

  • Before doing business with a new company, search the company’s name online with the term “scam” or “complaint.” Read what others are saying about that company. 

  • When it comes to products and services for your business, ask for recommendations from other business owners in your community. Positive word-of-mouth from trustworthy people is more reliable than any sales pitch. 

  • Don’t pay for “free” information. You may be able to get truly free business development advice and counseling through sources that can be verified and trusted. Stick with those.  

 

  1. To improve your chances of avoiding scams: 

Register with the Corporate Telephone Preference Service (CTPS), which operates a central opt-out register. It is a legal requirement that companies do not make such calls to numbers registered on the CTPS. This service is free of charge, and it will stop legitimate marketing calls as well as some from scammers. 

If you want to place ads, do your own research before you choose where to advertise. If you want to buy supplies, choose your own suppliers, and if you want to support a charity or good cause, identify that cause yourself and ask how you can help. 

Look out for the persuasion techniques used by scammers, and for warning signs that you are being targeted by a scam. 

Don't make a rushed decision, and do check small print carefully before signing any document. Make notes of any telephone conversation, and make sure that everything is confirmed in writing before making an agreement. 

Remember that a verbal contract is binding. Although you may be able to escape a contract if you were misled into making it, it is easier not to make the contract in the first place. 

Be aware that, as a business, you do not have the same cooling-off periods that are available to private consumers. 

Make sure that all staff who take external calls are aware of business scams, and circulate a copy of this guide to them. 

Check your systems and procedures for invoicing and payment to satisfy yourself that you are adequately protected. 

If you wish to complain about what you suspect is a scam, or want further information, you can contact Action Fraud

 

Related Blog:

Business Frauds and Scams – Beware and Protect (bromwichandsmith.com)

Author:

By Taz Rajan Community Engagement Partner at Bromwich+Smith 

Taz has been in the finance industry for nearly two decades and has always been passionate about education and empowerment.  Having declared bankruptcy herself, she intimately understands the shame, stigma surrounding matters of debt as well as the joy and relief that comes from restructuring. Taz actively works to normalize the conversation of debt through blogs, media interviews, webinars, lunch & learns and through building relationships. 

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