Financial frauds are not only
committed against individuals, there are many financial frauds conducted by
scammers against businesses. Thanks to financial frauds, some businesses are
even forced to close their practice due to the huge amount of losses incurred
from financial fraud attacks.
If you are thinking of starting your
own business, then it would be a wise to learn about these fraudulent schemes
so you can implement preventive measures that can block protect your business
against these malicious attacks. To give you an idea, here are some of the most
common financial frauds you may encounter in your business:
- Identity Fraud
Identity fraud is a financial fraud
that involves unauthorized use of illegally obtained credit card information.
Fraudsters use this scam against businesses by placing huge amount of orders in
forms of services or products, using stolen credit card information for
payment. This is why many businesses accepting off site credit card
payments are employing numerous layers of security measures such as address
verification service and credit card security code in order to filter legit
transactions from suspicious purchases. The burden of responsibility to check
the legitimacy of a transaction rests on the business. This is why businesses
are often left to suffer the losses caused by fraudulent schemes conducted
against their company.In order to prevent this disadvantageous scenario,
business owner is spending a considerable amount of money investing on payment
security products or services that can reduce, if not eliminate, this kind of
problem.
- Cheque Fraud
Cheque fraud is one of the many
forms of frauds committed against businesses. This type of financial scam
occurs when a scammer or fraudster intentionally uses cheques with insufficient
balance or are fake, to pay for products or services that they purchased. To
eliminate problems of this nature, businesses are now removing cheque payment
options as part of their accepted mode of payments. Another solution employed
by companies is to accept cheque payments and wait until the cheque clears
before they deliver the customers purchased products.
- Invoices and Payment Frauds
Invoices and payment frauds are
utilized by the scammers to illegally gain profit from their target businesses.
This type of fraud is commonly conducted by unscrupulous employee or employees working
together to defraud the business that they are working for. These scammers may
either use a fraudulent invoice disguised as a liability from one of the
company’s suppliers or by including a non-existent employee or subcontractor on
the company’s payroll. To eliminate these incidents of financial frauds, it is crucial
for a company to set up strict hiring policies or to employ a reliable internal
auditing system that will verify all the payables of your company.
The details
provided here are just some of the common financial frauds that you’ll likely
encounter once you start your own business. Note that most of these financial
frauds can now be easily eliminated, all you need to do is to diligently look
for effective suggested solutions that you can utilize, which is pretty much
how you can resolve most of the fraud schemes that you’ll encounter along the
way.
