Protecting your business from online fraud

Modern life tends to revolve around the use of the Internet. We take steps to protect things like our social media accounts, but are you taking the time to properly protect your business from online fraud?

Falling victim to an online fraud can have a massive effect on the productivity and reputation of your business, and when agencies like the Canadian Anti-Fraud Centre warn of increasing online fraud activities in Canada, it’s important to make sure your business is properly protected. That said, here are three reasons why you should be proactive in protecting your business from online fraud.

1. It saves you time and productivity

If your business experiences online fraud, your financial institution may freeze the account as soon as a problem is detected, in an effort to stop fraudsters from doing more damage. This can shut your business accounts down completely for at least a couple of days, and sometimes even longer.

With bank accounts shut down, it becomes nearly impossible for businesses to do the everyday things they need to do to run their business. Essential tasks such as accessing payroll and completing electronic transfers to vendors will be affected, impacting the day-to-day operations of your business.

Businesses that work with their financial institution to prevent fraud may be less attractive targets for fraudsters in the first place. Fraudsters typically go for the weakest target, and that when they get shut down right away, most will give up and look elsewhere.

2. It saves you money

Once there’s been fraudulent activity you will have to follow the proper reporting notification. Inform your financial institution and the police, so they can start and investigation. Then a forensic investigation is completed by the financial institution to confirm that the customer was victimized. It can take time and until the process is complete, you might be paying out of pocket.

Businesses can also find themselves out of pocket for the other costs that come with unravelling the mess created by online fraud. If you don’t have your own IT department, you’ll have to pay to have someone look at your systems and check for malware. It’s not a step you want to skip: even if you think your system is clear without a proper malware scan, versions of the malware could still be hiding undetected, screen scraping and collecting data as you work.

3. It saves your reputation

When businesses fall victim to online fraud, there’s always the possibility that it will impact how others view their business. If you’ve been a target of fraud, and the fact that you’ve been targeted gets out to the public, people could view you as an unsafe company.

This can cause customers to worry that their information has been compromised, and vendors may hesitate to work with you again because they don’t trust your systems or that you have the appropriate processes in place- and therefore their information - is secure.

Businesses that take steps to protect themselves from online fraud are also protecting their customers, which is good for building loyalty and retention (and saving your reputation).