Preventing Business Fraud
Business fraud is not just a financial issue.
It can lead to operational disruptions, legal entanglements, and severe reputational damage that can be hard to recover from. Unfortunately, it’s common. The Federal Trade Commission reported 2.6 million cases of fraud in 2023 alone.
Common types of business fraud include:
- Payroll fraud
- Phishing
- Business Email Compromise
- Ransomware
- Wire fraud
Business fraud is an equal opportunity threat, but certain industries are more vulnerable. These include small businesses, healthcare agencies, construction companies, real estate companies, technology companies, and nonprofit organizations.
Take these preventative measures to lower your fraud risk:
- Know Your Risk Factors: Educate your staff on types of fraud. Identify accounts and information that may be susceptible to ransomware.
- Implement Multi-Factor Authentication: Safeguard your employee email accounts and internal systems with multi-factor authentication, such as a username and password, confirmation emails/texts, and software apps.
- Establish Security Protocols: Ensure employees know how to handle sensitive information and transactions on secure communication channels.
- Monitor Financial Transactions: Set up bank account alerts and check account transactions daily to spot suspicious activity.
- Conduct Regular Internal Audits: Review financial and transaction records to identify discrepancies and vulnerabilities.
- Use Fraud Detection Software: There are programs to monitor, identify, and prevent fraudulent activity. If you use fraud prevention software, update your program to optimize your security.
Learn more about business banking fraud and how to prevent it with our online resources.