The Most Common Types Of Fraud That Businesses Face


Fraud occurs when an individual poses as someone else for their own malicious gain. Small businesses are commonly targeted by fraudsters. These fraudsters can take all different forms using all manner of strategies. Here are just some of the most common fraud crimes committed against businesses and how you can protect yourself.

Mail fraud

Mail fraud – often known as email phishing – occurs when a fraudster poses as someone else via email. This is usually done with the intention of getting someone to hand over sensitive data (for instance, a criminal could pose as a bank and ask someone to confirm their online banking details). Such emails may also contain malware or ransomware.

Detecting these emails has got a lot harder over the years – they can often look very genuine. Sites like Graphus.AI offer tools that can help you to detect these emails. Generally speaking, you should never give private details via email.

Customer fraud

Customers can commit fraud in a number of ways. False injury claims and false product faults claims are some of the most popular examples of customer fraud and cost businesses a lot of money.

You can often catch out these fraudulent customers by recording evidence. CCTV footage for instance may be able to capture a customer pretending to injure themselves, while quality checks of products can ensure that there were no faults before the customer bought them.  

Employee fraud

Employees can also commit fraud. In fact, some applicants may go through the entire hiring process simply to gain access to sensitive data. This may then be leaked and sold via the dark web.

Conducting background checks on all applicants and closely monitoring new recruits could help you to detect this type of fraud. Loyal long-standing employees are less likely to commit such fraud.

Vendor fraud

Vendor fraud can occur when criminals pose as vendors. This could take the form of phishing – a fraudster may pose as a real vendor of whom you use. Alternatively, a fraudster may reach out to you pretending to be a vendor, promising to undertake work only to disappear after you’ve made a payment.

When hiring vendors, always do your research to make sure that they have a trusted online presence and be careful when communicating online.

Identity theft

Identity theft is one of the most common forms of fraud. It occurs when a fraudster illegally poses as you or one of your employees. You may even have your brand identity stolen and misused (a fraudster may set up a copy of your website using your brand and may use it to swindle your customers).

You can prevent this type of fraud by guarding your personal data and protecting your brand. Regularly changing passwords and restricting who you share data with can help to keep your data safe, while trademarking your brand can prevent your brand from being misused.