How Can You Protect Your Business from Fraud?

on Thursday, 14 December 2017.

Business fraud can be a killer to your company and provide big earnings to crooks. From individuals to businesses, anyone can be targeted by fraud and it is wise to know how to protect yourself from it. Fraud comes in many forms and knowing how to recognize it in its numerous varieties will save you from a great deal of turmoil down the road. With this in mind, let's take a look at a few different examples of fraud and how to identify and deal with them when the time comes.

Fraud and Privileged Goods

One area where fraud has a tendency to show up is in businesses that sell privileged goods. A prime example of this is in the selling of guns. These fraudulent business are dangerous because they want to not only steal your money but your identity as well. The following are some ways you can protect yourself when it comes to companies that sell privileged goods.

  • Use a Website that Can be Trusted: This may seem like an obvious solution but you might be surprised by how many people do not do the due diligence needed to find if a website is even trustworthy. If, for example, a company sells guns from various sellers, you want to make sure that they have a sufficient vetting process to weed out the scammers. If at all possible, do your research on the website beforehand. The key is to find a website that verifies credit card billing addresses as scammers that steal card numbers will rarely have this information. Following these precautions will help you when it comes to using a website that sells privileged goods.
  • Know the Seller's Feedback and Ratings Before Doing Business: When you are doing business online, make sure you are using a website that allows you to see information about the seller like their feedback from other customers and how those customers have rated them. This is a straightforward and easy task that will save you from a world of headache.
  • Look Out for Listings that are Too Good to be True: Another area where you can protect yourself is by avoiding listings that seem too good to be true. If you come across a rare item at an unbelievable price then you probably shouldn't believe it. Be sure you are keeping your wits about you and exercising caution when making online purchases.

Business Loan Fraud

Business loan fraud is most common with consumers with bad credit. In a few states such as Wyoming, Nevada or Delaware, it is not that difficult to set up a fraudulent business to hide behind since there is no proof of identification required. The following are some ways you might be able to detect business loan fraud when you encounter it.

  • When a Single Person is Associated with Many Businesses: This should be a tell-tale sign of business loan fraud. If you do your research and come across something like this, especially if you see little sign of income associated with the companies, you should run the other way.
  • Does the Business Have an Actual Location: This is another important factor to consider. When looking into a business, it is important to ask the right questions about how many employees they have and whether or not they work at the location.
  • Ask the Business for References: A straightforward way of finding out if a business is for real is to ask for references from other banks they've done business with. If they give you suitable answers to your questions then you probably won't need to worry but if they refuse to answer your questions then it is a pretty good idea to not do business with them.

Fraud and Creating a Negative Online Presence

Another significant area in which fraud can do damage to your business is in the area of negative online reviews. Competing companies might create fraudulent companies to go after you online. This can severely damage your reputation and do lasting harm to your business. As such, you will want to know how to handle it when you encounter negative reviews online. The following are some popular places for online reviews and how they handle fraud.

  • Google+ Reviews: Though Google+ employs a specially designed algorithm for handling fraudulent reviews, it is not always effective. However, a way to work against this is by utilizing Google's My Maps App. This app will give you push notifications every time your company gets a Google+ review. This will allow you to properly deal with a suspicious review as soon as you become aware of it.
  • Yelp Reviews: Yelp also seeks to limit fraudulent reviews by use of its own review filter. But again, this feature can not always be trusted and sometimes fraudulent reviews will still slip through the cracks. A business owner would be wise to carefully monitor the reviews they receive on Yelp as 25 percent of Yelp reviews are considered to be potentially fraudulent.
  • Facebook Reviews: One considerable benefit of Facebook reviews is that the business owner can choose what reviews show up on their page. The downside however is that anyone can say what they want on the profile page. The good news is that there are ways to work against that. The free tool Mention, for example, scans your Facebook and other Social Media accounts for mentions of your business. Much like the Google app, this allows you to be aware of what people are saying about you online and is helpful when it comes to looking for any fraud that might be associated with these negative mentions.

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