Larry Selnick, Director, Treasury and Payment Solutions for Webster Bank Republished from Webster with permission
When you’re focused on growing your business, we know that finding the time to think about fraud protection can be difficult. However, fraud is a real threat that can impact your bottom line. In fact, every year U.S. businesses lose an average 5% of their gross revenues to fraud.* And no business is immune.
The unfortunate reality is this: If you’re open for business, you’re open to fraud. And while you may not be able to eliminate it completely, you can reduce your risk by following these simple steps:
Follow safe workplace practices
Separate your personal and business bank accounts and credit cards. This way, if one account is hacked, the other will still be safe. Separate accounts also make it easier to track your business expenses for tax purposes.
Shred all financial and/or account documents. And don’t let non-employees come in contact with paper files and trash.
Switch to online bill pay. Paper checks that are mailed can be stolen to obtain your account information. Paper bills should be stored securely.
Educate your staff. Make sure they know how to detect common fraud tactics and prevention measures. Periodic Risk Assessments can help you discover, correct and prevent security problems.
Review your insurance policies. Make sure you have coverage to protect your business against losses due to fraud.
Close the door on cyber crime
Secure your IT infrastructure. Invest in firewall protection, as well as anti-virus, malware and spyware detection software. Back up all your data on a regular basis.
Create a safe password policy. Make it a rule that employees create complex passwords that are changed regularly and never saved on websites where financial information is accessible.
Watch for suspicious emails. Tell employees to report and avoid opening unsolicited emails, links or attachments.
Run scans on portable storage devices. Employees should run scans on flash drives and other devices before opening any files.
Monitor your bank accounts. Watch for any unusual withdrawals or other activity by checking your online banking account every day.
Put financial controls in place
Use a dedicated computer for banking. Make all online financial transactions on one computer that is not used for social media, email or any other activity.
Secure your physical assets. Control access to bank statements and other sensitive documents, keep checks locked up, and review disbursements regularly.
Implement device identification and geofencing. Set up your payment system to allow transactions only from recognized devices, and to operate only within a trusted geographical region.
Separate employee duties. Divide up important accounting and account payable functions so that one employee doesn’t have all the control over financial activities.
Conduct independent reviews. Accounts and ledger balances should be reviewed regularly by someone who has no direct responsibility, such as an outside accountant.
Get professional advice
We know how important the security of your finances is to the success of your business. So we encourage you to get professional advice from your legal, IT and accounting partners. They can help you customize a fraud protection strategy to meet your specific needs. For more information, refer to Webster’s Fraud Awareness Checklist, leave a comment or contact me directly.
*The Association of Certified Fraud Examiners (ACFE) 2016 Report to the Nations Global Study on Fraud and Abuse.