How To Protect Your Business From Online Fraud

how to protect your business from online fraud

Currently in 2022 about 59% of the world’s population now has access to the internet, and more businesses are taking their activities online to take advantage of this global market of customers. 

However, in the two years from 2018-2020, nearly 47% of companies had experienced some type of online fraud, and according to reports the annual cost of online fraud globally is more than $5 trillion

Everyone knows eCommerce sites are an obvious target for fraudulent activities. But all businesses who operate online systems are at risk of data breaches and cybersecurity threats, whether they are selling goods and services online or not. There are also countless scams, viruses, and spam you have to avoid or minimize.

Take Steps To Protect Your Business 

Whether your business is a small eCommerce site or a global conglomerate, being proactive is the only way to make sure that you are protected from online fraud and other threats. 

Get An Expert For A Security Audit 

You cannot make positive changes if you do not know where you are now – and an expert that can complete a security audit will be able to determine whether there are any weak points in the existing infrastructure and be able to provide detailed advice on how to improve. 

Set Password Policies 

The importance of password security cannot be understated, and if you do not already have strong password policies in place, now is the time to instigate them. Ensure that all employees use individual passwords that are not easy to guess, and that they do not share them with other employees. Now 38% of fraud committed in eCommerce businesses came from internal perpetrators, so being savvy about who has access to different parts of the infrastructure adds extra protection. 

For consumers, instigating extra verification steps in purchases or other transactions (such as two factor authorization) will help keep their accounts secure. 

Recognize Symptoms Of Online Payment Fraud 

Online payment fraud is not necessarily huge purchases made with illegally procured card details, sometimes it can be lots of small transactions over a period of time. 

Other forms of online payment fraud include chargebacks, where a customer requests a refund for goods or services. Approximately 30% of items purchased online are returned, but chargebacks relating to returns can account for up to 80% of fraud losses. 

Keep an eye on usual purchasing behavior of staff and customers to help prevent these issues from starting to creep in. 

Train Employees 

All cybersecurity should have a top-down approach, with the C-suite on board helping employees get to grips with the systems. Training is an essential part of this and should be mandatory for all employees (with updates at least annually to keep up with new threats). 

Training should cover things like: 

• Account hijacking 
• Phishing 
• Malware 
• Ransomware 

Protect Accounts 

This point is especially valid for small businesses, but it is essential that bank accounts and credit card accounts are protected from each other, and that as a business owner you have a separate account for business transactions. 

This makes it much harder for a hacker to get access to all your funds and protects both your business and your personal finance. 

Insurance 

With the best will in the world, cybersecurity threats cannot all be predicted, and it is next to impossible to create a completely solid wall against the possibility of online fraud – so getting insurance can really help. 

Businesses can get ID Theft Insurance as well as other policies directly for reimbursing and recovering after online fraud or phishing attacks. 

Secure Documents 

Check fraud is still rife, even in the online world. Businesses should always use checks and other documents that have powerful built-in security features to prevent them from being misused, and it works even better if they are personalized to suit the company. 

Know Your Tools 

There are different tools that you can adopt to protect your business and your consumers from online fraud in 2022, including: 

• Card verification number 
• Address verification service 
• Email verification 
• Phone number verification/reverse look up 

Fight Fraud Forever

Businesses who have implemented some form of fraud prevention program have reported a 42% reduction in the expense of fraud attack response. So even if there are some initial costs involved, the potential to save money (and the business) is worth it to avoid scams, hackers, viruses, and other cyber threats.

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