Fraud is an unfortunate reality of monetary transactions. Every year fraudsters get cleverer and more trained to find new ways to deceive people and businesses. Once there is a human element in any financial process there is a weak point that is vulnerable to fraudulent behaviour. Even as many people move into the digital space, they are still susceptible to fraud.
It is always important to be aware of Fraud behaviour and how to avoid. Here are some fraud trends and how businesses can avoid it:
- Point of Sale Machine Skimming
In recent years there have been a lot of reports on POS skimming. Often what occurs is that fraudsters infiltrate businesses through “rogue” employees. Typically, they will ask the employee to bring the machine to the and they outfit the machine and install malware, the employee then brings it back to the establishment and places it back where it will be use.
How to avoid it?
It is important that business owners treat these terminals in a similar manner to the way to handle cash and cheques, keep it discreet. Even though they must be accessible to your employees and customers, you must have security measures around it in terms of where it is placed and ensuring that it is located in a place where CCTV is capturing all activity around it.
- E-Commerce Purchases
Some businesses have reported fraud when making transactions on e-commerce websites. Some Fraudsters present themselves as suppliers by having a similar website to a company and purchasing an official domain. They deceive the merchant and have the payments wired to their accounts. Fraudster can also purchase domains of a company and hack the email and or spoof the suppliers’ email.
How to avoid it?
If you are making a large transaction, try and get a direct form of communication with the supplier via email or, ideally, on the phone. It is important to build a relationship with your supplier offline for verification. If you have already worked with a supplier, it’s also important to be cautious of any change in financial information on their end. If they change their bank, account number or beneficiary you should contact the supplier or person you deal with for confirmation of these changes.
- Cheque Fraud
Cheque fraud is most prevalent in small businesses. It often occurs when the business is contacted by someone who orders or reserves items and promises to come another day to collect them and pay for them. They will then send someone else to pick it up and pay for the goods with a “managers cheque”. When the business goes to the bank, they often find out that the cheque is invalid.
How to avoid it?
It is crucial that no business does not part with their goods until they can authenticate the cheque. You can do so by checking the bank the cheque is issued to, contacting that bank’s customer service department, and requesting that they verify the cheque, and they will then ask you to provide the relevant information such as bank number etc.
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