Proven Methods for Protecting Your Business from Fraud

Did you know that global losses from payment fraud tripled between 2011 and 2020? In 2011, $9.84 billion was lost. In 2020, this figure was $32.39 billion. It’s estimated that the cost will increase to $40.62 billion by 2027. So, the situation is only going to get worse!

Because of this, businesses need to do everything in their power to protect themselves from this very real and growing threat.

Create an AML checklist

An AML independent review checklist is imperative for achieving AML compliance, which in turn will help you to prevent fraud at your business.

For those who are unaware, AML stands for anti-money laundering. Some businesses are at a greater risk of money laundering than others. This includes art businesses, accountancy firms, trust or company service providers, high-value dealers, real estate agencies, and money service businesses.

Some of the essential elements of your AML checklist

Monitor real-time transactions – Anti-money laundering regulations demand that transactions above a certain threshold are monitored. This threshold can vary from one market to another.

Perform Identity Verification Checks – Know Your Customer verification involves reviewing a customer’s full name, residential address, and date of birth. An official document is necessary to validate this information, such as a passport, national ID, or driving license.

Check sanction and PEP lists – PEP stands for Politically Exposed Person. They are considered at greater risk than the average person because they can be subject to corruption or bribery. You need to check PEP lists. Sanction lists tend to be grouped with PEP checks, yet you can find online databases that specialize in this type of data.

Add alternative data checks to your process – Criminals are becoming increasingly sophisticated, and they know how to bypass checks. Therefore, you need to look at alternative data that can help you to verify someone’s identity. This data can come from the kind of device the person uses, a phone number, an email address, or an IP address, for example.

Educate your employees and use online surveys to test their knowledge

Did you know that most data breaches are insider attacks? This doesn’t mean that employees have turned against you and are trying to take your business down. While there have been instances like this, most breaches happen because employees have left your system vulnerable without realizing they’re doing so.

This happens due to a lack of knowledge and education. You cannot expect your employees to know how to protect your system if you don’t educate them.

You need to train your employees. Regular training sessions are recommended. You can also send weekly newsletters with tips and pieces of advice.

It’s good to run tests using online surveys to find out whether or not your employees understand the risks. Stress that these tests have no bearing on what you think of your staff members. They’re purely to find out where more training is needed.

Adhere to the 12 points of the PCI DSS guidelines

If you take payments at your business, you need to follow these regulations. If you are found to be non-compliant, you can expect a very big fine to be coming your way.

The great thing about PCI DSS is that the requirements are very specific and so they genuinely help you to provide your business with as much protection as possible. From changing default passwords to protecting endpoints, everything is covered.

Protect all of your devices

This includes smartphones your employees use for work purposes.

Hackers are professionals when it comes to spreading threats that can infect devices, meaning they’ll ultimately have access to your business’ data.

You are also advised to implement a strong firewall so you can protect all outgoing and incoming files and data. Antivirus software is another critical component when building a strong multi-layered security plan. Antivirus will consistently scan for phishing emails or websites and dangerous threats.

Apart from using tools, you can keep accounts and devices safe with two-factor authentication and strong passwords.

Carry out frequent audits

Frequent audits will help to determine whether or not there are any evident signs of fraudulent activity happening at your business. If such activity happens, you need to take action to keep damages to a minimum.

Use a fraud management system

Next, use a fraud management system to keep your business protected. It provides a real-time screening of all of the transactions that occur across your computer’s channels, accounts, and computer.

Leverage professional help if needed

If data security isn’t your strong point, don’t try to do it alone. There are great security companies out there that’ll be able to put together a solid security plan for your company.

They will start off by conducting an audit so that they can discover any vulnerabilities that need to be patched up. They’ll let you know what you’re getting right and where you’re going wrong with your data security efforts.

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They have a whole host of different tools in their armory. Penetration hacking is a popular approach to getting to the bottom of how effective your network security is. With this, an ethical hacker will effectively hack into your system but rather than stealing data they will present you with the results and advice on what steps to take next.

Make sure your business doesn’t become the next victim of fraud

As you can see, there are a number of approaches you have at your disposal when it comes to protecting your business from the very real threat of fraud.

No matter how big or small your company is, it’s essential that you put methods in place to protect your employees, customers, and future. This list provides you with the perfect starting point!