- 28th November, 2024
- By Denise Choong
Reduce Scam Risks in Your Small Business
Scammers are constantly evolving their tactics to target small businesses. The federal government’s Scamwatch site is a great resource for understanding the latest scams and for reporting a new scam.
Knowing what threats are out there and what you can do to reduce scams can be crucial for safeguarding your business. In this blog, we’ll offer tips on how to avoid scams, but here are some of the most common scams and their tactics, to help protect you and your business.
Common scams in small businesses
Phishing scam
In a phishing scam, cybercriminals send emails that, at a glance, appear to come from reputable sources. These emails are laced with malicious links or attachments designed to steal sensitive information.
These scams rely on clicking harmful content so the criminals can enter your system. Vigilance is paramount; always verify the legitimacy of any email before taking any action.
Invoice scam
With invoice scams, fraudsters send fake invoices, banking on being paid without being scrutinised. These invoices closely resemble genuine documents, making them difficult to distinguish from the real thing.
Businesses are vulnerable, as the sheer volume of invoices processed can make it challenging to catch every deception. Implementing stringent verification processes and maintaining open lines of communication with suppliers can help thwart these attempts.
Business email compromise (BEC)
BEC is a particularly insidious scam where hackers impersonate executives or trusted colleagues, requesting money transfers or sensitive information. The sophistication of these scams often involves compromising email accounts, making the requests appear legitimate.
The financial implications can be severe, underscoring the importance of robust email security protocols and employee training.
Tech scam
Tech support scams involve emails from legitimate IT support services. These fraudulent entities claim to help fix computer issues but instead install malware or charge exorbitant fees for unnecessary services.
A good tip for avoiding these scams is to be wary of unsolicited tech support offers and seek assistance only from known and trusted sources.
Business opportunities
Fake business opportunities are another common scam, where offers that seem too good to be true require upfront payments or personal information. These scams can lead to financial loss and compromise sensitive data. It's essential to be wary of any opportunity that demands payment before providing value.
Education is paramount to help prevent scams. Here are some tips to help increase your team’s understanding of scams and how to deal with them.
- Hold regular sessions to teach your employees how to spot scams. Use real examples to make the training relevant and engaging.
- Keep scam awareness at the top of your mind with posters, newsletters, and reminders around the office. Regular communication helps reinforce best practices.
- Test your team with phishing simulations to identify vulnerabilities and improve responses to actual threats.
- Mandate multiple approvals for large transactions to catch fake invoices and suspicious requests.
- Educate your team that urgent requests, unfamiliar accounts or deals that seem too good to be true are red flags.
Cyber insurance can provide important protection in the event your business experiences a cybersecurity incident. But it’s a last line of defense, and it’s essential to have all the right mitigation strategies in place to prevent scammers from successfully breaching your systems and protocols.
We hope these tips help your business reduce scams in an increasingly dangerous environment. Contact your CIA broker today to find out more about the latest scams and how to avoid them.