5 Common scams that target your business

Navigating the world of business is challenging enough without the growing threat of scams that can take your money and sink your operation. Cybercriminals are becoming craftier, and their bold business scams demand ever more vigilance from you and your employees.

Here’s a look at scams that frequently target businesses and how you can stay ahead of attacks.

1. Fake invoicing

Fake invoicing is a very common tactic in which scammers send fraudulent invoices, hoping your company will process them without scrutiny. Fake invoices often seem to originate from familiar companies, such as your suppliers. To get this information about your company, scammers often infiltrate a company email account and intercept communications from your suppliers. They modify invoices, perhaps altering only the bank details on a PDF, leading your company to unwittingly transfer funds to the scammer instead of the intended supplier.

Alternatively, scammers might contact your company directly, asking for a contact name to send an invoice. They then send a request, masquerading as a known supplier or contractor, claiming their bank account details for receiving payments have changed. In reality, the account details have been switched to a fraudulent account.

What you can do

• Implement verification protocols
  Ensure that every invoice is cross-checked against purchase orders and delivery receipts.
• Make a phone call
  Verify any request to change a company's bank details by contacting them through a known phone number, rather than the one provided in the request.
• Use technology
  Invest in automated invoicing systems that can flag irregularities and prevent unauthorized payments.

2. Unsolicited products and services

Scammers often send unsolicited products followed by demands for payment, sometimes for exorbitant amounts. Unordered office supplies are a common example.

Similarly, unsolicited services may include advertising opportunities or directory listings, such as those in phone books. Scammers also often impersonate representatives of well-known companies like Google, offering "free" listings or ad space. They gather your information under false pretenses, later sending inflated bills and employing high-pressure tactics to coerce payment.

What you can do

• Refuse unsolicited items
  By law, unsolicited merchandise is yours to keep for free. Train your team to refuse goods not ordered.
• Verify all offers
  Before accepting any service or product, verify the legitimacy of the offer and the company behind it.
• Set clear policies
  Develop and enforce policies requiring verification of all new vendors and unsolicited offers.

3. Phishing

Phishing involves sending deceptive emails crafted to deceive recipients into divulging sensitive information or transferring funds. These messages often mimic trusted sources, such as colleagues or vendors.

A more advanced form of phishing occurs when the scammer impersonates a senior staff member and contacts a finance team member, requesting an urgent payment outside standard procedures due to exceptional circumstances. The email appears authentic because the "From" address mirrors the senior member's genuine email address, achieved through email spoofing or possibly a hacked account. Believing the email to be legitimate, the recipient proceeds with the payment.

What you can do

• Educate employees
  Train your team to recognize phishing attempts. Educate them about the fear tactics used by scammers and the false sense of urgency they often create.
• Implement security measures
  Implement a well-documented internal process for arranging and authorizing payments. Use email filters and anti-phishing software to catch suspicious emails before they reach your inbox.
• Confirm requests
  Always verify requests for sensitive information or financial transactions through a secondary channel, such as a phone call.

4. Overpayments

In overpayment scams, a fraudster impersonates a customer, places an order, and sends a check for an amount exceeding what is owed. After sending the payment, the "customer" contacts the business, claiming an error was made and requesting that the excess amount be wired back promptly. They may even request a refund. Because the company is concerned about negative reviews, it often processes the payment without hesitation. Ultimately, the check bounces, leaving the business out of pocket for both the wired money and any funds already used from the check.

What you can do

• No overpayments
  Refuse to accept overpayments and insist on the correct amount for all transactions.
• Wait for clearance
  Ensure checks clear before issuing refunds or delivering goods.
• Verify the buyer
  Conduct due diligence on buyers, especially those making unusually large orders.

5. Impersonation

Scammers can create counterfeit websites or email addresses that mimic your business's identity, and mislead customers and vendors into believing they are interacting with your company. When these customers or vendors fail to receive the promised product or service, your company's brand reputation can suffer, potentially leading to legal challenges.

What can you do

• Monitor your brand
  Regularly search for your business name online to catch impersonation attempts early.
• Communicate with customers
  Inform your customers about potential scams and how to verify legitimate communications from your business.
• Secure your information
  Protect sensitive business information online and use secure communication channels.

Protect your brand and bottom line

Business scams can have devastating consequences, but with the right knowledge and proactive measures, you can protect your enterprise. From implementing verification protocols to educating your team and investing in technology, there are numerous strategies to safeguard your business.

About Snap Finance

Snap Finance harnesses the power of data to empower consumers of all credit types to get what they need. Launched in 2012, Snap’s technology brings together more than a decade of data, machine learning, and nontraditional risk variables to create a proprietary decisioning platform that looks at each customer through a more holistic, human lens. Snap’s flexible lease-to-own and loan solutions are changing the face and pace of consumer retail finance.

For more information, visit snapfinance.com.

Snap-branded product offering includes retail installment contracts and lease-to-own financing. Talk with your local Snap sales representative for more details on which product qualifies at your store location. For more detailed information, please visit snapfinance.com/legal/financing-options.