Emerging Fraud Threats and Trends
With businesses reporting as much as $1.5 million in bank and wire fraud it’s important to be aware of the threats and trends in today’s landscape. Business and personal fraud techniques are very similar but the financial impact on a business is typically on a much larger scale. Criminals use both wire fraud and check fraud to access accounts and, as a business owner, you need to be aware of how these criminals target businesses.
Online Malware is a keylogging software program used by criminals to gains access to your network and record your keystrokes. Using this information, they can identify login information and access your accounts, making electronic transactions by ACH (Automated Clearing House) or wires to other accounts.
How to decrease your risk: When accessing sensitive information, be sure to use a network you trust such as your business or home networks, as opposed to using a public network. In order to use a keylogger, a hacker first needs access to your computer or network to put it in place—access to trusted networks should be password protected and more difficult to access externally.
Unfortunately, check fraud is a very simple crime to commit. If someone gains access to your routing and account numbers, they can purchase blank check stock and begin writing checks against your account. Another form of check fraud is on the rise is through department store debit cards. By using your check routing and account numbers, a criminal can open a debit card through a department store. Criminals are also opening credit cards with this information. Check fraud is still more common than any other transaction but electronic fraud is growing quickly.
How to decrease your risk: Be aware of the location of your paper checkbook and track who has access to your routing and account numbers. Also, consider moving more payments to electronic.
Email scams are a common form of online fraud and can sometimes be difficult to detect. Criminals send an email that looks like it came from a trusted source, such as a financial institution or the government, and requests personal and account information. This information may be requested as a response or through a link within the email.
How to decrease your risk: If you receive an email that asks for sensitive information, directly contact the institution and clarify their need for your response. Spelling errors and outrageous claims also indicate an email scam.
Credit/Debit Card Fraud
Similar to fraudulent activity by online malware, your credit or debit card information can be intercepted and used by criminals. This most often happens when making online purchases over an unsecure network and there may be no indication that your information was compromised.
How to decrease your risk: When making online credit or debit purchases, be sure to work on a trusted network. Submitting your account information through a public network increases your risk for fraudulent activity.
Simple tips to prevent fraud:
- Learn about the different types of fraud and educate your employees about how to identify and prevent fraud.
- Only share business account information with trusted members of your team. Remember that fraudulent activity can be performed by inside sources, as well as outside sources.
- Regularly monitor your bank accounts to detect any fraudulent activity. Online banking allows you to track your activity in real time as opposed to paper statements, which you receive only monthly.
- Put the available fraud detection tools and safeguards in place, such as ACH Filter or Positive Pay, which monitors for unusual check, debit or credit transactions. Detecting fraud is the best way to minimize your risk and consequences.
- Be proactive, rather than reactive. There may be a cost associated with fraud protection but it is worth the sense of safety and security it provides in return.