Protecting Your Business From Financial Fraud
Financial Fraud has become more advanced and today, most, if not all businesses use email and online banking for their financial transactions. Understanding the risks you may face can be the first step to protecting your business.
Here are a few examples of how businesses can become the victim of financial fraud:
- Employees no longer work for the company but have retained the company assets/passwords
- Fraudsters writing to companies who are having work done, purporting to be the contractor, advising their bank details have changed. The company then pays the next instalment to the fraudulent party
- Fraudsters purport to be directors (by creating a very similar e-mail address), and employees carrying out their fund transfer instructions into fraudulent accounts.
Putting simple security measures in place can help towards protecting your business and reduce the risk of you becoming the next target.
- Ensure controls in place for who can set up new fund transfers and who can amend fund transfers
- ALWAYS ask to verify bank details following instructions to amend the payee account (NEVER accept instructions solely via e-mail or letter as these can be fraudulent)
- Change passwords when people leave the business
- Ensure you have Firewall protection to prevent against unauthorised access
The insurance market has responded and policies can extend to cover for fraudulent loss – make sure your policy includes reference to ‘social engineering’ and ‘false presidents’ cover.
Zach Gray is the Commercial Director at D E Ford Insurance Brokers. Providing bespoke insurance packages for businesses and charitable organisations.