How to Protect Your Business from Pandemic-Related Fraud
Seventy-seven percent of anti-fraud professionals have seen an uptick in fraud since the COVID-19 pandemic began, and they expect it to continue.1 An explosion in e-commerce, readily available government assistance, and more remote workers are contributing to the increase in criminal activity.
Fraudsters think they can hide among e-commerce transactions.
Two-thirds of consumers increased online shopping because of the pandemic.2 The e-commerce boon not only gives fraudsters more transactions in which to hide, but it also introduces more inexperienced users who may be vulnerable to its potential security risks.
Pay attention to suspicious transactions and payment types.
- Pay close attention to the amount of the transaction. The average fraudulent transaction is three times greater than that of a legitimate transaction.
- Consider activating a fraud protection platform, like Address Verification Services (AVS), to confirm a cardholder’s billing address with the respective card issuer.
- Beware of orders that use payment types other than credit cards. Contact the buyer for information if something looks suspicious.3
Criminals use your business information to steal emergency funding.
Sixty-two percent of businesses received emergency relief due to economic conditions,4 including more than 5.2 million individual PPP loans in excess of $525 billion.5 With an extraordinary number of recipients, an abbreviated funding timeline and relatively minimal applicant oversight, fraudsters can’t resist the opportunity to exploit the system. They simply steal sensitive business information and use it to fraudulently apply for a federal PPP loan.
Regularly update and safeguard business information.
- Start your search for pandemic financial assistance directly with a local financial institution or the Small Business Association website (sba.gov).
- When considering working with a new company, get its Dun & Bradstreet number so you can check its credit history.6
- Check your business registration details and credit report regularly or freeze your credit. Dun & Bradstreet offers free credit monitoring for businesses.7
Remote work increases cyber security risks.
During the pandemic, nearly one-third of companies increased teleworking opportunities for employees.8 While working remotely enables employees to perform their duties, it also increases security challenges like phishing and malicious software as IT teams try to provide the same level of network oversight. Business email compromise — in which criminals send a fraudulent email requesting payment from what appears to be a bank, merchant, or high-level employee — is another trick of the trade.
Maintain high levels of remote access and payment security.
- Be careful when sharing company information. Know who you’re talking to.
- Strengthen your remote access management policy and procedures. Implement multi-factor authentication for VPN access, IP address whitelisting, limits on remote desktop protocol access and remote network monitoring.
- Plan your response to a phishing attack. Know who you'll contact and how you'll contain the fallout before it happens.
- Be skeptical of unexplained, last-minute, or urgent changes in wire instructions or deposit information, including senders who insist on communications in email only.
- Verify any request for changes via the contact on file vs. using the information provided in the email received.
- Use two-factor authentication to verify any change to account information or wire instructions.
The typical organization loses five percent of its revenue to theft.9 But the effects ripple beyond just monetary loss to erosion of your brand, reputation, consumer trust and employee morale. Heightened awareness, vigilance, and education will help effectively guard your business from fraudsters.
Contact Synovus Treasury and Payment Solutions, your Treasury Consultant, or Relationship Manager to see how Synovus can help.
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