Scams are on the increase. As businesses become wise to scams, the criminals behind them become more sophisticated in their approach. The consequences to a business that has been the subject of a scam can be more than financial. Confidential business sensitive information that can affect your position in the market, your brand and consumer confidence may be at risk.
Add to this that money made through scams is often used to fund criminal, including terrorist, activities, the need for businesses to be vigilant could not be more important. Scams can be carried out by anyone, anywhere in the world and is a lucrative method of funding for those involved. Last year 39% of business in the UK were subject to a scam. While down slightly on 2020 figures, scams remain a major threat to business.
What different types of scams are there?
The main types of scams are online phishing scams, fake investment opportunities and identity theft.
A phishing scam is designed to defraud the victim of money by requesting payment or confidential details that would allow them to access your bank account.
A fake investment scam is just that. Often disguised as a quick and sure way to make money, offering incredible rewards for an investment. Once payment is received you would only hear from the perpetrators of the scam again if there was an opportunity to defraud you of more money.
Identity theft is a pernicious form of scam that can result in loss of money, loans being taken out in your name and a low credit score. You may find you are unable to renew your passport, access your own bank account or discover your home and business are sold without your knowledge.
What does an online or cyber scam look like?
A scam can take many forms. Cyber scams can come in the form of phishing emails carrying viruses that once opened, plant themselves on your device to extract confidential information.
Some scams may involve fooling you in to believing you are communicating with a legitimate business, only to collect confidential information or access your bank account.
Some scams start with a phone call during which they try to persuade you that they are a representative of a legitimate business and then persuade you to access your bank account. Sometimes the object is to get you to provide them with access to your computer, at which point they can use your device to gain access to whatever facilities or information they want.
What does a phone scam look like?
Phone scams focus on persuading you that they are calling from a legitimate business. If successful they can convince the victim to provide confidential information which can be used to execute bigger scams.
They might also get the victim to make payments to a fraudulent account. Customers of large organisations that use overseas contact centres, such as BT and British Gas, are particularly vulnerable to these sorts of scams.
By purchasing a virtual landline number the scammers are also able to pretend they are calling from a local or UK business. This is a tool designed for legitimate businesses to build customer confidence by appearing local. However, the opportunity the facility offers to scammers presents a problem that perhaps needs to be addressed.
How do you spot a business scam?
The most obvious sign that you might be interacting with a scammer may be when you receive unsolicited calls or emails asking for personal information or bank details.
Websites that look odd. Clocking websites such as banking websites is a method used by many scammers.
Check your bank account and credit card statements for any unusual transactions. Scams that might start with a phone call may lead to money being fraudently taken from your bank account. The sooner you spot the scam the more likely you are to avoid the worst consequences.
If you receive any unrecognised invoices this could be a red flag. As could any rejections for credit applications with suppliers. If a scammer has taken out loans in your name or emptied your bank account your credit score will be affected.
When you are expecting your new business credit card or other documents containing confidential and personal information to arrive in the post, make sure you have received them. If documents don’t arrive this might be a sign of a scam in process.
How do you avoid falling victim to a business scam?
- If you work on your own define a set of rules that you follow to protect yourself from scams. I would suggest you write these down.
- If you employ others, including freelancers, have a written policy to ensure everyone understands the requirements. Procedures to avoid being scammed should include the following.
- Make sure up to date firewall and anti virus software are installed on all your computers, smartphones and tablets.
- If you receive an email check who it is from. This might seem obvious but email management software such as Microsoft Outlook allow emails to show up as a display name. This means you see the display name as the sender rather than the full email address. This enables a scammer to describe themselves as someone legitimate. Unless you click the display name to see the actual email address you may be none the wiser.
- Never open a link in an email unless you trust the sender. Links might lead to malware or link to a website, including a banking website, that might be fraudulent.
- Don’t open a link inside an email to a PDF or other document file. Such documents can carry viruses. If they are attached to an email they should be virus checked before opening. However, if they are accessed via a link, such as a Dropbox link, this may not be possible. If the document carries a virus it will try to plant itself your device. Only open Dropbox links or other links to documents if you trust the sender.
- Never provide personal details, card numbers, remote access to your computer, or online banking card reader codes over the phone or email.
- Often scammers hang up as soon as you start to question their legitimacy. If someone abruptly hangs up, block the number and give short shift to any other caller contacting you under the same pretence.
- If you have any doubts about a company, tell them you will call them back. You would then use the legitimate contact number for the company that has claimed to contact you to check if the call is a scam or genuine. If you do this make sure the scammer hasn’t actually remained on the line so that when you dial the correct number they are able to answer as if you have called them. In this case, by staying on the line the scammer has kept the line open. This means you may have dialled the correct number but, as the line wasn’t free at the time, your call remains with the scammer. To avoid this make sure you have a dialling tone before making the call.
- If you are on an ecommerce or banking website check the domain name or anything that doesn’t look legitimate. For instance poor design and the lack of contact details should raise concern. If you are in doubt abandon use of the website before carrying out any transactions.
- If you think you may have been scammed, report it immediately to the police and your bank. The sooner you act the more chance there is of resolving the issue. Never keep quiet about falling victim to a scam out of embarrassment. That’s how the scammers win.
And finally…
Fighting the scammers is an ongoing battle. As a business owner, the damage business scams can do can have serious consequences. By creating a written policy and investing in the latest anti virus and malware software, you will protect yourself from attacks. But, if the worst does happen, report it. Scamming is a lucrative business. So beating the scammers is a formidable task. Taking the right measures and responding quickly to attacks will help you to avoid falling victim.