5 Ways To Stop Creeps From Impersonating Your Business

Surprise! Identity theft is no longer just a threat to consumers. Fraudsters are now targeting businesses to impersonate--as if owning a business weren't enough stress! According to BusinessIDTheft.org, these crooks can impersonate your business in several ways:

  • Phishing: Someone poses as your business and sends phony emails out (with your logos) in order to obtain personal information from those who take the bait.
  • Deceptive websites: Stealing your logos yet again or using a similar business name, they create a false website and lure in unsuspecting consumers.
  • Stolen credit cards: Fraudsters use stolen credit cards to make purchases at your business and then you are responsible for the chargeback fee; or, they will steal your Tax ID and set up credit card processing accounts in order to charge stolen credit cards, thus destroying your reputation and possibly terminating your own merchant account.
  • Fraudulent W-2's: Stealing your EIN, they make fraudulent W-2's, massively overstating your tax withholding, which leads to investigations and audits of your business.
  • Job offer scams: Someone impersonates your business in order to obtain the personal information of people who apply to fake job openings.

Unfortunately for business owners, the liability for business ID theft can be much higher than the liability for consumers.  So what can you do to prevent someone from impersonating your business?

  1. Read your business banking agreement closely. Find out exactly what you will be liable for in the event of ID theft. BusinessIDTheft.org states that businesses have "shorter reporting timelines, less protections, and higher liability for fraud than with consumer banking accounts."
  2. Consider using two-factor authentication for electronic transfers and wire transfers. If your business doesn't use wire transfers, see if your bank will block them or set a cap on how much money can be transferred. Fraudulent transfers happen very quickly.  Chances are you won't catch them before they happen. That's why it's vital to....
  3. Reconcile your bank accounts daily! This is where good bookkeeping comes into play.  If you're reconciling your bank accounts daily, then you will spot fraudulent charges much more quickly, thus reducing your liability and financial losses. Don't have time to reconcile daily? I'm here to help!
  4. Protect company information. All documents with your company's information should be kept in a safe or shredded.  Don't give out your ID number to anyone you haven't initiated contact with. If you have to give out sensitive business information online, always be sure that the site is secure. The SBA even recommends replacing company credit cards with prepaid cards for employees, which give you more control over how much money is spent and where.
  5. Check your business's credit report frequently. I hope you're saying "Duh!" right now because this is self explanatory :-)

While there is no surefire way to completely protect your business, these 5 things will certainly mitigate the problem. Your business is your baby, so protect it like one!