Training Your Employees to Identify and Prevent Fraud in your Business
As a small business, fraud prevention is likely a significant area of concern. While fraud is probably not on the mind of a business during the course of the day as there are many other tasks to complete for the business to be successful. To ensure your employees are aware of wire fraud trends and how to prevent fraud, training and fraud prevention procedures are important. Rather than fraud protection being one more task to add to your list, just include it as part of your business strategy based on external fraud threats and fraudsters attempting to steal your money.
Each year, fraud takes a toll on companies large and small, but in recent years, criminals are increasingly targeting local small businesses. The key trends along with action items for business owners to follow in an effort to prevent fraud are identified below. No matter how prevalent you think fraud is among small businesses, this information offers an opportunity to put in place the safeguards necessary to protect you and your customers.
Consumers and businesses are periodically conned into wiring money to infamous actors most often via licensed money transmitters like Western Union and MoneyGram. Once a consumer sends money to a scammer, it is often impossible to find the fraudster or retrieve the money. What complicates matters is the reality that wire fraud criminals are located both inside and outside of the United States. As a business owner, it is necessary to recognize the most common wire fraud scams which include:
Business Email Compromise/Email Account Compromise: Imagine a typical day at the office. An employee receives a friendly reminder email from a vendor they’ve known for years about an invoice coming due. The email is conversational, asks about the employee’s recent vacation, and then reminds the employee that a late payment for the invoice could result in a surcharge if not handled immediately. Communications like these may be the work of a wire fraud criminal.
Vendor Payment: A fraudster will email someone in a business informing them that their payment is late and will result in an additional late fee or removal of services.
Debt Collection: Posing as a debt collector, a wire fraud criminal uses threats to make the consumer settle a fake debt.
Advance Fee Loans: A scammer poses as an online lender and after the consumer submits a loan application, they are directed to wire processing payments to the lender. Once the consumer wires the money, the loan is never received.
