As a business owner, you’ve likely heard how important it is to always be on the lookout for phishing emails, text messages, and phone calls. Fraudsters know how busy small businesses are, and they’re banking on you not having the cybersecurity knowledge necessary to spot a scam. Even if you recognize the name of a sender or caller, you can’t automatically assume that a communication is legitimate. Fraudsters can easily “spoof” a phone call, text, or email so it appears to come from someone you trust.
It's vitally important for you and your staff to be vigilant when it comes to potential scams. A correspondence that contains typos, poor quality images, or unusual or urgent requests should always be treated with suspicion. Hover over (or press and hold) all links that are sent digitally so you can preview them before clicking. Never click on a link that is pointing to an unfamiliar website, or a URL that differs slightly from the web address an organization typically uses. Be especially wary of any communication that asks you to provide sensitive or financial information.
It's also important for you to know about specific scams that are currently targeting small businesses. The more you know, the better you can defend yourself and your business from fraud. Here are 5 business scams currently making the rounds:
1. Corporate Transparency Act Scams. In January of 2024, a law called the Corporate Transparency Act was introduced, requiring certain businesses to report their beneficial ownership information (BOI) to the government by January 1, 2025. Fraudsters are seeking to capitalize on this looming deadline by posing as government agencies in order to trick business owners into giving them money and sensitive information. Remember that your beneficial ownership information should only be reported through FinCEN’s secure electronic system at https://www.fincen.gov/boi, and that there is no fee to file this information. You should also be wary of any correspondence asking you to click a link or QR code in order to file your BOI, as these could take you to fraudulent websites. Your best bet is to visit the FinCEN site directly at https://www.fincen.gov/boi to complete your BOI reporting or get answers to your questions.
2. Loan & Grant Scams. In these types of scams, crooks claiming to be from a financial institution, the SBA, or a local or federal entity, contact a business owner directly with an offer of a loan or grant. They request personal and financial information, and typically some form of advance payment in order to complete the funding process. Be wary of any unsolicited phone calls, emails, or text messages you receive regarding such funding, and never provide sensitive information. If you receive a communication about a loan or grant you think is legitimate, do some independent research to verify the offer before proceeding with an application. You should also be suspicious of anyone claiming that you’ve been approved for a loan or grant that you haven’t applied for.
3. Tech Support Scams. Business owners know the importance of protecting their customer information and internal data, and scammers will unfortunately try to take advantage of that. Beware of any phone calls, emails, or popups on your computer stating that your business software or systems need updating, or have a virus. If you do receive this kind of notification, manually check for available updates or any security alerts. If you’re still unsure and want to verify that all is well with your technology stack, contact a reputable IT or cybersecurity company, or utilize your internal IT employees to confirm.
4. Fake Invoice Scams. In this type of scam, criminals send phony invoices to a business for products or services that they would commonly use. The hope is that whoever is paying the bills will assume the invoices are real and will pay them. Be sure to have a system in place for verifying all invoices that come into your business and ensure that your team knows what services and products are being used on a regular basis. It’s better to have someone question an invoice than to mistakenly pay a fraudulent one.
5. Charity Request Scams. Local businesses are often called on for donations to organizations in their communities. Scammers may take advantage of this and send fake donation requests. Often, they pretend to be representatives from legitimate charitable organizations as well. If you are interested in supporting a particular charity, you can always reach out to the organization through their public contact information to verify the request. It's also a good idea to provide any monetary donations via a check written out to the charitable organization, and request a receipt as well.
It’s critically important for businesses to always be on the lookout for scams. Ensure both you and your employees know how to spot a scam before it does serious damage to your business and finances. For the latest business security tips and alerts, visit https://www.bankfive.com/business/business-resources/business-security.