Reduce the risk of being scammed in 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 scams are out there and what you can do to help prevent them can be crucial for safeguarding your business. Here are some of the most common scams and their tactics, to help protect you and your business.

  • 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 pilfer sensitive information. These scams rely on clicking harmful content so the criminals can get into your system. Vigilance is paramount; always verify the legitimacy of any email before taking any action.
  • 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) 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 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. The key to avoiding these scams is to be wary of unsolicited tech support offers and seek assistance only from known and trusted sources.
  • 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.

Stop scammers in their tracks

Education is paramount to help prevent scams. Here are some steps that can 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 top of 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 defence and it’s essential to have all the right mitigation strategies in place to prevent scammers from successfully breaching your systems and protocols in the first place.

Contact your Steadfast broker today to find out more about the latest scams and how to help prevent them.

 

Important notice 

This article is of a general nature only and does not take into account your specific objectives, financial situation or needs. It is also not financial advice, nor complete, so please discuss the full details with your Steadfast insurance broker as to whether these types of insurance are appropriate for you. Deductibles, exclusions and limits apply. You should consider any relevant Target Market Determination and Product Disclosure Statement in deciding whether to buy or renew these types of insurance. Various insurers issue these types of insurance and cover can differ between insurers.

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