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How Can You Prevent Fraud Against Your Virtual Finances?

Did you know that fraud costs the US roughly $190 billion a year? That’s a phenomenal amount of money, with businesses (particularly online merchants) incurring the highest relative costs – approximately twenty times as much as the banks.

Sadly, your business is not immune to fraud. All of our virtual finances are under particular threat, and many business owners don’t know what to do to safeguard against monetary (as well as reputational and data-centric) losses. If you want to prevent fraud against your business’s virtual finances, here’s where to start…

Watch Out for Corporate Identity Fraud

Corporate identity fraud occurs when a criminal impersonates a legitimate business using fake or stolen information to obtain your business’s money. It takes the form of phishing emails and false invoices, so it’s important you’re aware of these if you want to prevent fraud against your virtual finances. But how?

Well, the first step to take is to remember to never give your passwords, bank details or answers to security questions out via email. You’ll know this already of course, so more importantly, neverinput this information into a website or process a payment for an invoice if you’ve been directed to it via an email that isn’t legitimate or already ‘on your books’.

In order to determine whether or not a request is legitimate, you’ll first need to check the email address and display name of the sender who’s directed you there. Is it a legitimate company, and does this person indeed work for the company? Do you have an existing relationship with them if they claim to be someone waiting for payment on an invoice?

Then you’ll need to check if the website URL seems appropriate for the sender it is purporting to be from (hovering your mouse over the URL to see where it goes rather than clicking it). And, if there’s a request for payment (particularly if the request seems urgent or pressurizing), find alternative contact details for the person sending the request rather than using the details they’ve provided you with to determine the authenticity of the demand. It’s good to speak over the phone if you want to investigate whether a request is a scam than to simply skipping straight to making a payment or providing financial details.

Make Some Payments in Checks and Cash

Don’t worry – we’re not actually suggesting that you run away and hide from the world of virtual finances. After all, digital payments, banking and online transactions are an inevitable part of business life both now in and in the future. But that doesn’t mean there’s not a case for making somepayments offline.

Online fraudsters aren’t going to be able to employ the same subversive methods to your cash and check payments, meaning you’ll be safeguarding at least a portion of your business’s finances. So, consider paying some suppliers or vendors in the form of a check, especially if you have a good enough relationship with them to make regular face to face meetings.

However, even check payments can be vulnerable to fraudulent activity. That’s why you should look for wallet checks with tamper-resistant coatings so that your offline business payments are just as fraud-proof as your online payments. Other strong recommendations include securely storing your wallet checks when they’re not in use, restricting access to wallet checks, and never pre-signing checks.

Train Your Workers on Anti-fraud Measures

Finally, unless you’re using an automated rule engine (a technology that generates rules automatically to guard against fraud), you’ll need to continually train your staff on the best and most up-to-date anti-fraud measures around. Ensure your anti-fraud infrastructure can prevent criminal activity against your virtual finances by hosting workshops to teach your staff about the risks, likely methods of fraudulent activity and what to do if they find themselves in a situation they’re unsure of. Online training in a safe, virtual environment is a good idea too if you can afford to provide it: that way, mistakes won’t cost your business any ‘real’ money.

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