Fraud Prevention Tips for Businesses

As a business owner, you have a lot on your plate. Between managing employees, keeping up with inventory, and ensuring that your customers are happy, it can be tough to find time to worry about fraud prevention. However, ignoring this potential threat could cost you big time. Here are some tips to help you stay ahead of the curve and protect your business from fraud.

1. Implement a two-factor authentication process for logging in to your company’s accounts. Two-factor authentication adds an additional layer of security to your online accounts and business management programs. An example would be a program requiring a password and a one-time passcode sent to your cell phone for authentication.
2. Educate your employees on how to identify fraudulent emails, phone calls, and text messages. A common tactic is scammers will create an email that looks like it’s coming from management and send it to your employees requesting sensitive information. If you’ve provided training for your employees on what to look for, they’ll be able to catch the fraudster.
3. Train your staff on how to respond to a data breach. A data breach response plan can reduce the risk of unauthorized data access and mitigate the damage caused if a breach occurs. Employees can be confident about what to do if a breach occurs and take action quickly, including providing proactive communication to affected customers or vendors.
4. Use strong passwords and change them regularly. Typically, each program will have its own password requirements, but a good rule of thumb is to have a long password (about ten characters) with a mix of upper and lowercase letters, numbers, and symbols. Don’t use personal information or use the same password across multiple programs/logins.
5. Protect your computer networks with firewalls and antivirus software. A firewall helps prevent attackers or external threats from getting access to your system. Antivirus software protects the file system against unwanted programs. Having both in place will help protect your computer and your business.
6. Regularly audit your financial statements, credit reports, and systems for any signs of fraud or vulnerabilities. Some examples to look for are increases in invoices that result in multiple payments, inventory discrepancies, or a growth in your revenue without a corresponding change in cash flow.
7. Secure your physical office space by installing security cameras and alarms. Not only will this secure your inventory, but it will also provide a sense of enhanced security for your employees.
8. Use secure payment methods in-store, online, and on the go. If you’re not sure about the security of your credit card processing system, Coastal can help! Visit our website for more information: https://www.coastalbank.com/product/credit-card-processing/
9. Back up your data regularly in case of an attack or natural disaster. Backing up your data and having a secure archive of critical information helps protect against power failures, failing hard drives or operating systems, and recovery if there is a cyberattack.

Businesses should take precautions to protect themselves from fraud. Implementing the tips we’ve outlined can help you reduce your chances of becoming a victim. To read more advice and download material, like materials for training your employees, visit the Federal Trade Commission (FTC) Guide for your Business.

If you’re the victim of a fraud scam, be sure to let your Coastal banker now and report the incident to the FTC. The FTC just updated ReportFraud.ftc.gov, its consumer reporting website, to make reporting easier to include small business reporting.