How to Protect Your Business from Fraud

Byline: Ryan Mordecai, Fort Worth Market Leader

When scammers target your small business, it not only damages your bottom line – it can also ruin your reputation. The best way to stay safe? Make sure you’re aware of common business scams and teach your employees how to avoid them.

Common small business scams

Need help protecting your small business from scammers? Get familiar with common schemes and tactics fraudsters use to target entrepreneurs.

1. Fake invoices. Scammers create fake invoices that look like they’re from legitimate suppliers and vendors. However, the bank details are usually altered, and business owners end up sending money to criminals.
2. Mysterious merchandise. Fraudsters call you offering “free” samples and then “verify” your address. Once the unordered goods arrive on your doorstep, they start demanding payment.
3. Impersonators. Scammers pose as trusted entities, pressuring you to share sensitive company information and make immediate payments. They may threaten you with service disconnection, loss of your web domain, or even claim to be government agents collecting fees and back taxes.
4. Credit card processing scams. These thieves promise lower processing rates or better leasing deals, but the fine print often locks businesses into bad contracts. Watch out for requests to sign blank documents and sketchy salespeople who won’t give you copies of the agreement up front.
5. Fake checks. For this scheme, scammers overpay you with a check that seems to clear, then ask you to send back the excess amount. When the fake check eventually bounces, you’re still held responsible for the money you sent.

How to protect your business

The best protection is prevention. Keep your business safe from scammers with these simple tips.

1. Prepare your staff. Your employees are your front line of defense. Whether they’re answering the phone, sorting emails, or communicating with customers or vendors in person, train them never to disclose sensitive information. Additionally, educate staff on the proper procedure for reporting suspicious activity so you can escalate the situation if needed.
2. Authenticate invoices and payments. Establish crystal-clear procedures for approving purchases and invoices. Make sure you or a trusted member of your staff examines all invoices and checks closely, and never pay a “vendor” with a wire transfer, cryptocurrency, or gift card.
3. Beware of phone or email scams. Scammers can manipulate caller ID, so don’t rely on it as an authentication method. Beware of unexpected texts or email messages, especially if they contain strange links or files. Never open these attachments – that’s how scammers download malware onto your devices.
4. Protect your network. To safeguard your business bank accounts, use tools such as firewalls, anti-spyware, and laptop and hard drive encryption. Block network computer access to high-risk websites such as adult entertainment, online gaming, social networking, and personal email. We also recommend dedicating one computer that is not connected to the business network to online banking and cash management activity.
5. Do your research. Before conducting business with a new company, do a thorough online audit. Search their name along with “scam” and see what other people have to say about them. When possible, ask friends and business owners you trust for recommendations so you can stay safe.
6. Keep passwords up to date. Regularly update all passwords for online accounts that contain personal data, including online banking, payroll systems, accounting software, tax services, vendor payment platforms, and other essential business tools.
7. Enroll in Positive Pay. Safeguard your business against fraudulent or invalid checks with Positive Pay. This service helps you prevent and identify fraudulent checks within your account by matching the check and verifying its authenticity. Positive Pay provides an opportunity for you to make explicit pay/no pay decisions on check items that are presented against your account, reducing check fraud and protecting your bottom line.
8. Immediately report suspicious activity. If you notice any abnormal account activity or have reason to believe your company’s account information has been compromised, reach out to your Origin banker or contact our Customer Support Team at (888) 292-4037.

Relationship banking for your business

Regardless of whether you own a business, always contact the Origin team at the first sign of an account breach. Our team is here to help protect your sensitive data as well as your money. Want to learn more about safeguarding your small business? Visit www.origin.bank/en/business/treasury-management/ to learn more about the products and services we have available to protect your business from fraud.