Common Types of Fraud and Prevention Strategies
As a leader within your organization, you want to trust your employees and the people you do business with. However, the sad reality is that no organization is immune to the threat of crime and fraud. Making matters worse, the average time before an organization discovers that fraud has occurred is 18 months, long after the damage has already been done.
To protect themselves and their bottom lines, it’s important for businesses to understand the following common types of fraud:
- Phishing scams. A phishing scam is a phony email or pop-up message that is used to lure unsuspecting internet users into divulging personal information, such as credit card numbers and account passwords. To protect your information, never open emails unless you are certain that the message is from a legitimate source. In addition, do not share personal or financial information via the internet unless the site is secure.
- Extortion and ransomware scams. Ransomware is malicious software designed to block access to important software, files or systems until a sum of money is paid. Computers can become infected with ransomware in a number of ways, but it commonly occurs when malicious links or attachments are opened. To protect your business, be wary of pop-up ads, back up important files and investigate ransomware issues right away.
- Office supply scams. Canadian businesses lose significant sums of money to fraudsters that pretend to be their regular suppliers. Be aware of unsolicited emails and contact existing partners before sending funds in order to confirm payment requests.
- Employee fraud. During times of economic insecurity, normally honest employees may resort to theft or other fraudulent activities due to the increasing financial pressure they are feeling at home. To curb theft at your organization, communicate with your employees, maintain a positive work environment and educate your employees on acts of fraud and the consequences associated with it.
To further protect your organization, it’s important to have an anti-fraud policy in place. This policy should allow you to properly train your employees on how to recognize and prevent common types of fraud. If your business is impacted by fraud, it’s important to report it to your local law enforcement and the Canadian Anti-fraud Centre.
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