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Top tips to prevent fraud in your business

Nov 11, 2018

New research carried out by FraudSMART has revealed that over one-third of SMEs have been targeted by a financial fraud scam within the past 12 months and one in 18 of these attempts was successful. Niamh Davenport outlines how SMEs can protect themselves.

Emerging technology and improved connectivity have helped SMEs take advantage of new business opportunities, but they have also presented fresh opportunities for fraudsters. The financial fraud experienced by SMEs are still committed by using emails and telephone with phishing emails (72%), vishing (26%) and invoice redirection scams (21%) being the most common.

The impact of falling victim to financial fraud can be devastating both financially through lost funds, lost revenue, the cost of any legal action and security upgrades, and non-financial, resulting in a tarnished reputation, loss of trust and low employee morale.

Fraudsters are targeting SMEs because they are known to have less security and controls in place. Investing in fraud prevention does not have to be a costly task. Simple processes and procedures, such as verbally confirming new bank account details, can prevent a large payment from getting into the hands of a fraudster who is trying an invoice redirection scam.

The same goes for CEO fraud. In these cases, fraudsters will make an email appear legitimate with tactics such as imitating the language used by the CEO or senior executive, or choosing a time when they know the CEO is out of the office on annual leave, making you reluctant to pick up the phone and confirm the email.

With vishing, another common scan, fraudsters target a business by phoning and claiming to be your bank, card issuer or service provider. Fraudsters try to extract details about your computer system, business, debit or credit card, PIN number, online banking numbers and passwords. This can then be used to gain access to company bank accounts, carry out transactions or steal personal customer information.


The best chance any company has against being defrauded is prevention. Here are some tips for SMEs.

Be informed

  • Ensure employees are fraud aware and understand the controls and procedures in place to prevent fraud.
  • Don’t assume you can trust caller ID. Phone numbers can be spoofed so it looks like a particular company is calling.
  • Fraudsters may already have basic information about you or your business in their possession (e.g. name, address, account details), do not assume a caller is genuine because they have these details.

Be alert

  • Be wary of payment requests that are unexpected, irregular or require changes to bank account details, whatever the amount involved.
  • Always exercise caution when forming new relationships with potential customers. Undertake appropriate due diligence.
  • Always check your statements. If you notice any unusual transactions, report them to your bank immediately.

Be secure

  • Don’t allow yourself to be rushed. Take your time to do the relevant checks.
  • If a supplier/service provider requests bank account details to be changed, have a verification process in place before making payments.
  • Ensure security and software is regularly updated and maintained using official and reliable software.

Niamh Davenport is the Fraud Awareness Manager in Banking & Payments Federation Ireland.

FraudSMART’s National Fraud Awareness Week runs from 12-18 November and is focusing on SMEs. To learn more about how you can protect your business, download their brochure Protect Your Business from Fraud on their website

Simon Delaney will also be explaining five common types of financial fraud scams every day on FraudSMART’s social media channels.