Business identity fraud
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Business identity fraud

  • 10 July 2017

If you have experienced a fraudster posing as your company to send emails to customers, make purchases, apply for loans or communicate via social media, then you are a victim of business identity fraud. This is the fastest-growing kind of fraud in the business world. So the question is: how can you prevent it?

Fraudsters operate under your company name – either using company information they have obtained from the internet or through leakage or theft of confidential hard-copy documents. 

Tips for preventing business identity fraud

The most important steps you can take as a company are:
-    Handle business-related and personal data with care;
-    Stay alert and inform employees about the risks of fraud;
-    Implement a strict ICT policy including clear procedures and controls;
-    Store confidential documents in a safe place and never dispose of them in regular rubbish bins;
-    Destroy old documents using a good shredder;
-    Carefully check the identities of customers and staff.

If a person poses as your company on social media, you can report it. Platforms such as Facebook, Twitter, Instagram and LinkedIn all have special pages for this on their websites.

Are you a victim of invoice fraud?

Imagine you receive an invoice from one of your regular suppliers. Unbeknown to you, a fraudster has intercepted the original invoice and just changed the bank account number. Unwittingly (because you trust the regular supplier), you pay the invoice but the money goes to the fraudster instead of your supplier.

There are various forms of invoice fraud:
-    Fraud based on a real invoice, in which case only the bank account number is altered;
-    A phantom invoice, which is issued for a non-existent product or service;

The most important tips for arming yourself against invoice fraud are:
-    Compare the bank account number shown on the invoice against the account number listed in your admin system;
-    Adhere to sound purchasing procedures; work with purchase numbers and order numbers;
-    Call to check the payment;
-    Be alert to so-called urgent transactions that require you to deviate from the normal procedure.

Know who you’re doing business with

Contact the Chamber of Commerce to check who you’re doing business with. In the Netherlands all companies, organisations and legal entities are listed in the Handelsregister (‘Trade Register’) which has been set up to safeguard legal validity in the economy.

Take action if you discover business identity fraud

Has your company fallen victim to identity fraud? If so, don’t take it lying down! Report it to the police and – in the Netherlands, at least – help other companies too by also informing the national Fraud Help Desk.

Source: ©Kamer van Koophandel - 2017