Common scams targeting small businesses

Small business is the backbone of the American economy, but it is also a prime target for scammers. Why? Because small businesses often don’t have the time or resources to do security, leaving them vulnerable to attacks. And the scammers know it. They know how to exploit the vulnerabilities of small businesses, and they do so with alarming frequency. In this blog post, we will look at some of the most common scams that target small businesses. From phishing scams to fake invoices and more, we’ll help you learn how to protect yourself and avoid becoming a victim.

Professional Fraud

What is professional fraud? Simply put, this is when employees steal from their employers. This includes embezzlement, theft of goods, lying to investors and shareholders, and falsifying checks and payments. Last – falsification of checks and payments is one of the most costly professional fraud schemes, accounting for about 10% of professional fraud cases in 2021 and averaging over $100,000 in losses per incident, according to ACFE (Association of Certified Fraud Investigators, which produces an annual report for the Nations, a global study of professional fraud).

Email Fraud

Email scams are one of the most common scams targeting small businesses. They may come in the form of phishing emails designed to trick recipients into revealing personal or financial information, or they may be malware emails that contain malicious attachments or links that can infect your company’s computers with malware.

Email scams are often very sophisticated and difficult to detect. If you are not careful, you can easily become a victim of one of these scammers. That’s why it’s important to be aware of the most common types of email scams and how to protect yourself from them.

Virtual meeting scam

Earlier this year (February 2022) The FBI issued a warning about the increase in scammers using virtual meeting platforms to try and scam businesses. Fraudsters have capitalized on the fact that companies have become more comfortable using virtual meeting technology to conduct business as COVID has shut down workplaces around the world. According to the FBI report, scammers use virtual meeting platforms to send fake meeting invitations with links to join meetings and then try to collect personal information.

Account Fraud

Small businesses are often targeted by scammers who try to get them to pay fake bills. This scam usually starts with the scammer contacting the business and pretending to be a supplier or other vendor. They will then send an invoice for goods or services that the company does not actually owe. If the business pays the bill, the scammer simply takes the money and no goods or services are provided.

To avoid this scam, businesses need to be careful when paying bills. Also, only do this after making sure they really owe the money. They should also contact vendors directly to inquire about invoices they are unsure about, rather than just paying them without checking first. If you believe you may have been the victim of this scam, contact your local law enforcement agency immediately.

Data Leak Fraud

Data breaches are becoming more and more common, and scammers are taking advantage of this by targeting small businesses. They will send an email or call, pretending to be a representative of a well-known company such as Microsoft or Google. They will say that there was a data breach and they need your login information to fix it. Don’t fall for this scam! These companies will never contact you out of the blue, and if you give them your login details, they will have access to all your sensitive data. If you receive one of these calls or emails, hang up or delete it immediately.

How to protect your business from scammers

• Do your due diligence when hiring, especially if you are hiring a remote workforce.
• Use multi-step verification for employees who have access to financial information and tools.
• When using paper checks, use watermarked checks to prevent forgery, forgery and photocopying. Even today, as digital money transfers usurp paper checks, a single fake check can cost you thousands of dollars or more.
• Use security software. In this post, we will talk about VPN blockers, wireless hotspots, password managers, and multi-factor authentication. This can be easily implemented and supported by either your own IT team or someone who has been vetted for cyber security risk management.
• Require employees to change passwords regularly.
• Use a highly secure cloud storage system like OneDrive or Google Drive to store and share documents. Use permission restrictions and two-factor authentication to sign in and access folders and files.
• Don’t allow BYOD (bring your own device) in the workplace. If you allow BYOD, you have the right to require employees to use antivirus and cybersecurity measures before connecting to your organization’s servers.

Conclusion

It is important for a small business owner to be aware of the common scams that target companies like yours. By becoming familiar with these scams, you can protect yourself and your business from becoming victims. Remember to always be vigilant, and if something seems too good to be true, it probably is. If you have any doubts, do not hesitate to consult a trusted advisor or lawyer.