Business owner? Watch out for fraud

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by: tomvpowell
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Word Count: 507
Date: Mon, 29 Mar 2010 Time: 9:35 AM
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Fraud on businesses has been rising dramatically over the past few years, but it may not just be business fraud in the sense that you know it, which will affect you badly. Identity fraud is on the rise even faster, and more and more business owners are being targeted, as they are the people more likely to have extra funds and multiple accounts in these somewhat troubled times. So, if you are a business owner yourself, watch out for the new ‘business fraud' where someone posing as you could undermine everything you own if you are not careful.

Identity theft rose 22% from 2007 to 2008, with around 10 million people affected, according to a study by Javelin Strategy & Research Centre. The agency Experian also investigated the issue, finding that business fraud on owners took a 70% rise in the second half of 2009 compared to the first. It is important to realise that credit is not being granted to many people at the moment, in light of the fact that banks do not want to take a gamble. For this reason, your business may well be targeted as, as a business owner, you are likely to have existing credit and be in a better financial state to have money lent to you. If you have identity fraud carried out on you as a business owner, then it can be as bad as business fraud as an inside job and targeted at the business instead of you.

Wallet, bag and document theft is still the most common way of acquiring details of people, and once gotten fraudsters act fast, with the majority (71%) of people seeing the fraud take place within a week of seeing their items go missing. It is vital that you give people as little opportunity to steal as possible. Make sure you do not take any personal details, such as bank numbers, to work. Make sure all of your finances are handled by a trusted team, if you employee people to do so, and keep this a small circle of people that you can keep an eye on. Unfortunately, people close to your business accounts are just as likely to be able to steal. A lot of business fraud is embezzlement, but employees may also be able to use your name to set up accounts and get credit they are not planning to pay off, leaving all of the debt in your name.

As long as you keep an eye on everything and are cautious then hopefully you can avoid identity and business fraud. Shred all letters with your personal details as soon as they have served their purpose; only carry what you need on you and always check your accounts for money coming out and report anything you think seems odd. If you are a business owner, identity fraud can be a great risk for your business due to the financial implications that will be put on you, so always ensure you maintain a cautious air and hopefully you will avoid any problems.

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If you suspect business fraud is eating away at your profits, then get in touch with a forensic accountant to see what malpractice they can unearth from your accounts and records.