Battling identity theft: effective strategies to keep fraudsters at bay

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Businesses are already familiar with the standard cybersecurity protocols regarding password protection and secure data sharing. However, despite this awareness, identity theft and fraud continue to be significant issues for companies in all industries. Identity theft is a criminal act where an individual or business's identity is illegally assumed for fraudulent purposes and financial gain. When the stolen identity is used, it becomes identity fraud.

What can you do to keep your business safe?

Identity theft is not just a problem for individuals but a growing concern for large corporations as well. This is because cybercriminals find it easier to target big organizations that have significant amounts of money in their bank accounts and high credit limits, making it easier for them to hide their illegal activities.

Although the latest version of GDPR has reduced the scope of online details available to cybercriminals, it has become easier for identity thieves to obtain company information over the years. Information about organizations and their employees is readily available on business websites, Companies House, and LinkedIn, making it an attractive target for cybercriminals.

Fraudsters can use this information to trade under your business' name and exploit its existing reputation. They can also steal details of company credit cards or bank accounts and sell them on the Dark Web, causing irreparable damage to your business' finances and reputation.

Moreover, cybercriminals can send phishing emails to employees, asking for confidential information such as bank details or confidential announcements. If released early, this information could affect the stock value of your company. It is also not uncommon for emails riddled with viruses to be circulated in the workplace accidentally, which could give hackers access to your company's internal systems.

Corporate identity theft can have devastating consequences for your business. If your company falls victim to identity theft, its finances, confidential information, and reputation could all be at risk, which could result in irreparable damage and financial losses.

Prevention is better than cure

Identity theft can often lead to catastrophic financial losses, paralyzing your business. As such, all companies should take out cyber insurance — no matter how big or small or in which industry they operate. No sector is safe from this type of cybercrime, but cyber insurance can cover you and help protect your company.

It is worth noting that financial loss that stems directly from a fraudulent act is often not covered by a standard cyber insurance policy, so it is essential to check how inclusive your plan is. However, many cyber insurance companies offer cover for fraud and financial crime as an add-on to your primary policy.

However, although cyber insurance is a worthwhile investment, prevention is better than cure. The chances of experiencing a breach are much slimmer if the appropriate processes and software are implemented within your business. So, investing in up-to-date cybersecurity solutions is paramount to evading identity theft and fraud. Some critical measures that could help prevent identity theft include encryption of employee data, installing firewalls, automated system updates, and using robust total endpoint security solutions (more than just antivirus software).

Educating staff on the importance of not divulging sensitive data to unauthorized third parties is also essential. Remember, repeatedly, people have proven to be the weak link in corporate security chains. Often, this is down to careless mistakes rather than malicious actions, so it is vital to teach employees what to look out for and what to do if they suspect a communication could be suspicious.

It is also advisable to partner up with a trusted IT specialist or consultant who is uncompromising regarding cybersecurity. This specialist should help you identify any cyber security issues or threats — whether a lack of processes, poor compliance, inadequate staff training, or failure to make the best use of advanced technologies — and then work with you to remediate the issues that have been identified. They should also be able to offer continuous advice and access a wide range of technology solutions to ensure your company is protected from all angles.

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Richard Menear is the CEO at burning.  His specialises are in operational risk management and has held senior positions in a number of global financial institutions. He is responsible for the overall management and day-to-day running of Burning Tree, where he supports the directors in the delivery of their assignments and on the development of the consulting practice in the field of information risk management.