4 Common Business Scams
Thieves and malicious actors are always trying to take advantage of businesses. They do this by running scams through the use of technology to get information, money or free products from unsuspecting businesses. Below, we will look at some common scams and how to deal with them.
Slip-and-fall insurance scams are common especially for businesses that have parking lots. Most of the injuries from these accidents do not show up on x-rays. Vehicle accident scams are also common, and they happen when people slam on their brakes so your company vehicles can collide with theirs. To protect yourself from these scams, ensure you have adequate insurance coverage and invest in some security, dashboard and rear vehicle cameras.
These often involve emails that seem to come from legitimate sources. Once you open these emails, they spread malware that can steal valuable data such as banking information, credit card numbers and passwords. To protect yourself from these scams , do not open emails whose senders you do not know or enter sensitive information on any website unless you have visited the website directly from your address bar and not from clicking a link.
Shipping Scams Tied to Credit Card Theft
If you run an e-commerce business, you need to be aware of shipping scams. These scams often involve stolen credit cards. The thief will make an order using the stolen credit card and give the business a bogus shipping address. Once the purchase goes through, the order will be shipped to the wrong address. Once the thief is notified that the package was not delivered, they then contact the shipping company to provide an alternate shipping address.
This type of fraud can cost your business a lot of money in shipping costs when the package is eventually delivered to the new address. It can be prevented using identity and address verification.
A company can put measures in place to ensure customers cannot purchase any products without verifying their identity. This limits the chances of a stolen credit card being used for purchases. Second, address verification ties real users to their physical addresses, so rerouting or providing an address not associated with the credit card used to make the purchase becomes impossible. There are automated systems that can help you do both of these things, including one developed by Cognito HQ.
Cognito HQ’s identity verification system ties customers’ identities to their phone number, to reduce the chances of fraud and scams. Cognito HQ also lets businesses see the last 15 addresses associated with a customer to prevent the shipping fraud as described above.
This works for businesses that receive a lot of invoices every month. A scammer can slip an invoice in there and you might end up paying for advertising campaigns you do not know about, bizarre memberships or even office supplies that never arrive.
Protecting yourself from this scam is as easy as not signing any invoices until you can go through them and check every item on the invoices.
As long as your business makes money, someone will try to scam you out of it. It is therefore important that all businesses learn to identify common scams and put the necessary precautions in place.