It is far more common than you might think. Someone gets hold of your Social Security number and a previous mailing address and — voila! — you’re the victim of identity theft.
But what is business identity theft?
Business identity theft is when a criminal impersonates your company in an effort to personally profit, often resulting in tax problems for you, as well as a diminished credit report and, ultimately, a tarnished reputation. As a business owner, you’re a bigger target than an individual and, making matters worse, the theft may also extend to your employees and/or your clients. But you can protect yourself and ensure that you’re prepared against any virtual “break-in” of your business.
Signs of Business Identity Theft
Businesses are appealing marks for crooks — to the tune of billions of dollars a year — mainly because much of their data is available online and they tend to have more revenue — and revenue flow — than individuals, making financial losses somewhat easier to miss. If your business is on the smaller side, as its owner, you can arm yourself with the knowledge of what to look out for.
Duplicate or fraudulent invoices: Be vigilant about reconciling invoices, payments and bills, and make sure there are no duplicates. That’s often the sign of a breach.
Falsified registrations and filings: Most states’ filing systems are in “good faith,” so it’s fairly easy for criminals to change your info — mailing address, leadership names and contact info, etc. — in an effort to assume control of your business. Regularly review your filings and enroll in any alerts that your state may offer.
Phishing scams: Common scams use email or text messages to try to learn your private information, i.e., account numbers or passwords. Any “urgent” notice or email asking for sensitive information — especially to be shared electronically — is highly suspicious and likely fraudulent. Email spam filters stop many of these swindles, but extra layers of security are available, too.
How to Prevent Business Identity Theft
It may seem daunting, but it is possible to protect your business from business identity theft.
Never share your billing information, nor any sensitive info with anyone who randomly calls or emails, “phishing” for confirmation of these details. Always check the credentials of anyone seeking such information before sharing anything. Make sure your employees know to do this, too, and that they report attempts to obtain sensitive information to you.
Stay on top of your paperwork, including account statements, registration info and credit reports. If any of your accounts or statements seem off, look into the issue right away. It may take a billing cycle or two to reveal that your business identity has been compromised, but don’t wait to check on and/or report what doesn’t look right.
Take preventative measures. From cyber security software to insurance, many entities exist that can help you keep your business safe — whether that business is still active or you shuttered or sold it years ago. Business identity thieves also prey on defunct businesses, so stay vigilant throughout your entire career to ensure that no one can prosper off a business that you built.
Tell the authorities by reporting any breaches to the credit bureaus and, if it’s warranted, the Federal Trade Commission.
Protecting Your Business Is Our Business
Farm Bureau offers the coverage you need to protect your business, including data breach insurance. Contact your local Farm Bureau agent today to learn more about insurance options for your business.