How Businesses Can Avoid Financial Scams
Today, the risk of losing money, data, and information to scams has become even more prominent as people rely on computers and smartphones for communications and financial transactions. More recently, a trend called the “pig butchering scam” is making headlines as a dangerous and rampant security issue. The peculiar name refers to “fattening victims up” before taking everything they’ve got. While this mainly occurs with cryptocurrency, pig butchering scams can be done with other types of financial trading as well and is comparable to ransomware attacks and digital extortion — both prevalent types of scams targeting businesses. Therefore, companies should learn how to protect themselves from financial scams preemptively. In today’s post, we’ll look at some critical practices businesses can apply to stay safe:
Use payment machines that guarantee safety
Businesses need to ensure their payment processes are secure. After all, scams are as devastating for companies as they are for customers. When accepting contactless payments for credit and debit cards as well as applications like Apple Pay and Android Pay, businesses should use a mobile card payment machine. These devices have wireless capabilities that can process sales, refunds, cashback, and gratuities anywhere in your store without any premium charges.
Furthermore, these are designed to comply with the Payment Card Industry Data Security Standards (PCI DSS), ensuring greater cybersecurity. Customers are more likely to opt for digital and contactless payment methods in these digital times, and these payment methods will offer better recordkeeping for businesses. Clear, organised records of your business’s financial information are crucial to protecting your business.
Perform routine internal reviews
Performing periodic internal reviews can help you keep track of your business’ progress and alert you of any concerns early on. For small and medium-sized businesses, in particular, routine internal audits play a significant role in keeping your business at low risk of theft and fraud. Recently, the government announced a Payment and Cash Flow review to evaluate how late payments from larger businesses affect smaller firms, given the £23.4 billion currently owed in outstanding invoices. Internal reviews can definitely help businesses struggling with their cash flow in this scenario.
Internal reviews can be scheduled weekly, monthly, or quarterly; what’s important is that you fully grasp your business operations, profits, and potential losses. Prioritizing good data hygiene and periodically reviewing your data also ensures that you are collecting only essential and relevant data to help inform future business decisions and narrow down data security measures.
Invest in cyber protection for computer systems
With the recent rise of remote and hybrid work opportunities, small and medium-sized businesses are likelier to adopt this work arrangement as it can save costs and resources, such as office rental space. With remote and hybrid employees, however, comes the risk of your corporate network becoming more vulnerable to attackers. Most big businesses will have their cybersecurity teams and experts ensuring the safety of their corporate systems. Unfortunately, this causes attackers to focus on home users and remote employees from small businesses with weaker defences.
Investing in basic cybersecurity precautions such as anti-malware and raising awareness of email and messaging phishing scams can make all the difference. Cybersecurity practices should also be ingrained in your business strategy, including securing your employees’ hardware from potential threats such as malicious web extensions and “Trojanised” software. Small businesses can also refer to the government’s National Cyber Security Centre, which offers support and advice on identifying vulnerabilities through its Cyber Assessment Framework.
Establish open communication with customers
Finally, it’s not enough to protect your business and employees. As mentioned above, financial scams also target your customers, threatening your business revenue. Having a clear and transparent relationship with your customers and community can increase trust in your business and reduce the risk of financial loss.
In a previous post on Facebook scams, we note the various ways that consumers can get scammed on the platform, from phishing to fake ads and charity fundraisers. Communicating these threats with your customers is good practice, showing transparency and concern for customers’ financial well-being, and can prevent the risk of your business being connected to online fraud schemes. At the end of the day, protecting your customers is as vital as protecting the business.