When doing E-Business, fraud prevention should be at
the top of the list
Even veteran business owners can be victims. Many of
us remember the high profile Madoff case, where many
highly experienced professionals got fooled and fell for a classic Ponzi
scheme.
The online business world is a prefect hunting ground
for scammers. They can apply their “offline” tricks to the Web with minimum
efforts and investment. In this article we will have a look at some fraud prevention actions you can take to protect your e-business.
The best fraud prevention comes from you!
Local authorities and website providers do what they
can against scammers, but there is only so much they can do. For every
fraudulent website closed, two others pop up the next day.
Being aware of scammers’ techniques and procedures is
the best way to avoid fraud.
Fraud prevention: know your enemy!
Online fraud is rarely done by a single individual.
Scammers work within networks and are well organized. Fake services, fake
products, anything that requires financial transactions is at risk. Here are a
few examples of what you can do to avoid fraud.
•
Check if the website you are dealing with is legit.
Keep in mind that a professional-looking website can
be done in a matter of hours, so don't judge the book by its cover.
Check the URL. Many scam e-business websites use free
hosted or sub-domain websites. The name of those hosting websites is always
mentioned in the URL. For example if the address says www.amazon.hpage.com
instead of ww.amazon.com, it's a fake.
It is possible for scammers to register for free
domain names that are less noticeable. You can still spot them as the suffix is
always associated with the free domain provider. If the address ends with
suffix like “co.cc” or “biz.com” you should investigate it.
It doesn't mean that all business websites using free
domain names are scams. Sometimes it's a good solution for small business
owners that aren't tech savvy. But if a supposedly international company claims
to provide professional services to prestigious clients (they often show
testimonials on their home page) and can't afford a professional website, then
something is fishy.
•
Confirm the contact information are real.
You can do so by entering postal addresses and phone
numbers in Google search. If the company is listed on a fraud prevention
website, you'll have saved yourself time and money in a matter of seconds.
Other red flags include: dozens of businesses registered at the same address or
P.O. Box, mobile phone number but no land lines, emails asking you to fill a
form, etc. Write an email and call the number provided to make sure they aren't
fake.
•
Leave a “cyber-paper trail”!
Choose methods of payment that leave a trace. Only
accept cheques from people you trust.
When providing online forms, make all the important data fields
mandatory such as phone number, address, cardholder name or email address. This
will make it easier for you to look up the information given.
If you'd like more detailed information about
e-business fraud prevention, here is some very interesting research by Sharon
Curry: download PDF. Fraud comes in many forms, so keep yourself
informed!
