Learn More About Business Identity Theft

Learn More About Business Identity Theft

Identity Theft is not just a personal problem: Part I

Identity theft is not merely a crime that affects individual consumers. Businesses, of all sizes and structure, are identity fraud targets as well.

Cash is king, and your business bank account holds a princely sum

Like everyone else, criminals want more money with less work. Businesses routinely carry much larger bank account balances than average consumers, making them desirable and tempting targets for identity thieves and cybercriminals. From a criminal's perspective, if you had a choice of stealing $500 to $1000 from an individual, or $10,000 to $100,000 (or more) from a business with roughly the same amount of effort, which would you choose? The answer is obvious, and the resulting shift from targeting consumers to targeting businesses presents dangerous new threats to businesses of every size.

How much can your business afford to lose?

Business bank accounts do not enjoy the same level of fraud protection as traditional consumer bank accounts. Shorter reporting timelines, significantly increased liability for fraud losses, and reduced (or non-existent) transactional scrutiny in business and commercial bank accounts mean businesses must aggressively protect their cash accounts.

Infection of business computers and business systems by viruses, Trojans, and other malicious software ("malware") can let thieves access your business bank accounts, leading to quick and potentially devastating financial losses to your business. It is critical that you and your employees know the risks and take appropriate measures to protect your business. Any business that fails to do so can suffer tremendous losses with little or no hope of recovery.

A List You Don't Want Your Business to Be On

  1. A Kansas car dealership lost $63,000 after the business manager's computer was infected by malicious software that allowed thieves to initiate a fraudulent payroll transfer for 9 fictitious employees.
  2. A New York marketing firm's computers were infected by malware, resulting in the theft of $164,000, cancellation of a pending acquisition by another firm, and potential bankruptcy.
  3. A Maine construction company lost $345,444 (out of a total of $588,000 taken) after its computers were infected by malware.
  4. A North Carolina fuel distributor lost $800,000 through multiple fraudulent ACH transactions over a five-day period.
  5. A Washington state hospital lost $1.03 million after its bank account was breached and thieves initiated 96 fraudulent ACH transactions.
  6. An industrial products company in Texas had its computers infected by malware and lost $1.2 million through 43 fraudulent wire transfers within 30 minutes.
  7. A California escrow company was forced to close after its controller's computer was infected by malware and thieves stole roughly $1.5 million.
  8. A Michigan machining and manufacturing company lost $5.2 million through 97 fraudulent wire transfers after its CEO's computer was infected by malware. (The bank was ultimately able to recover all but $561,000.)

More information and resources

The national business identity theft resource website, BusinessIDtheft.org, offers a wealth of free information, resources, and tips to help you protect your business from thieves and cybercrime.

Read Business Identity Theft Part 2    

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