Starting and running a very small business can be incredibly fulfilling, but it also makes you a prime target for scammers. As technology evolves, so do the tactics fraudsters use, making it harder for business owners to stay ahead. The consequences of falling victim to these scams can be severe, potentially threatening your livelihood and even closing your business.
Real-Life Story from Australia: A Business Falls Victim to an Email Hacking Scam
A small business owner in Australia became the target of a sophisticated email hacking scam. The fraudsters gained access to a supplier's email system and sent the company fake invoices with amended bank details. They even included previous email exchanges between the business and the supplier, making the communication look completely legitimate. The invoices were exact replicas of the real ones the company had been receiving for years, so nothing seemed out of the ordinary.
Believing everything was genuine, the business unknowingly transferred $190,000 to the scammers. The real supplier never received the funds and didn't even see the email responses. It wasn't until the supplier contacted the business by phone to inquire about the missing payment that they realized something was wrong. The hackers had somehow intercepted the email responses, preventing the supplier from ever seeing them.
Source: scamwatch.gov.au
Top 10 scams to watch out for when you own a small business
Understanding common scams is key to protecting your business and employees. Let’s take a closer look at the scams you’re most likely to face.
Scammers often pretend to be trusted individuals or organizations to pressure you into paying or sharing sensitive information. For example:
Related: What Is an SSL Certificate And 6 Reasons Why Your Small Business Website Needs One (link to be added)
Related: Imposter Scams On The Rise: How to Protect Yourself
2. Office Supply Scams
Like in the story above, fraudsters pose as your regular office suppliers, reminding you to reorder supplies like paper or toner. If you agree, you'll receive overpriced items you never intended to purchase. In some cases, you might receive unordered goods followed by demands for payment. If you do receive goods you didn't order, you have the right to keep them without paying, according to the Federal Trade Commission.
3. Marketing, Advertising, and Reviews Scams
Scammers may trick you into paying for advertising that doesn't exist or for being listed in a fake business directory. They might ask for your contact details under the guise of offering a "free" listing or claim they need to confirm your business information. Once they have your approval, you could receive an unexpected invoice, and they may even use a recording of the initial conversation to pressure you into paying.
Other scammers promise to remove bad reviews, add positive ones, or boost your ratings on review sites. It's important to note that posting fake reviews is illegal, and endorsements must reflect genuine opinions and experiences according to FTC guidelines.
4. Vanity Awards Scams
Some scammers target business owners with fake awards, claiming they've been chosen for a prestigious title or feature in a publication. They'll ask for a fee to cover printing or promotion costs. Before paying, research the organization to confirm its legitimacy, and don't let flattery cloud your judgment.
5. Fake invoices Scams
Watch out for scammers who might sneak a fake invoice in with your regular bills. They may charge you for items or services you never requested, like advertising never shown, memberships to nonexistent trade groups, or office supplies you never ordered or received. In some cases, thieves might go as far as researching your suppliers to create invoices with names that sound familiar.
Related: What Are Invoice Scams and How Small Business Can Stay Safe
6. Utility Scams
Scammers might call or send you emails pretending to represent your utility company, claiming your electricity or internet will be shut off unless you pay immediately. These fraudsters rely on creating a sense of urgency, hoping you'll act without thinking. Legitimate utility companies will send written notices and give you multiple opportunities to pay. If you're unsure, contact the service provider using the phone number on your actual bill.
Related: Top 9 Utility Scams: Tips to Recognize and Avoid Them
7. Valuation Scams
In this scam, a fake business broker offers to help you sell your company. After charging you for a valuation or other services, they disappear without providing anything of value. If you're considering selling your business, always verify the broker's credentials and ask for references before paying any fees.
8. CEO Scam
Attackers pose as a company's CEO or high-ranking executive. They typically send an email to someone in the finance department asking for a money transfer to an account controlled by the scammers.
CEO scam is a form of Business Email Compromise (BEC) attack, which we covered extensively in another article.
Related: How to Prevent or Recover from A Business Email Compromise (BEC) Attack
9. Credit Card Processing and Equipment Leasing Scams
Fraudsters often promise lower rates for credit card processing or better deals on leasing equipment, but the contracts are riddled with hidden fees and misleading terms. Some may even change the terms after you've signed. Never sign blank documents or trust promises without getting everything in writing. If a deal seems too good to be true, it probably is.
10. Small Business Loan Fraud
When applying for loans, small businesses are at risk of falling victim to fraudsters posing as representatives from legitimate banks or organizations like the Small Business Administration (SBA). These scammers may request sensitive financial information from your business and ask for upfront deposits or fees. They often use fake email addresses and forged logos that mimic the SBA or other trusted institutions to make their offers appear legitimate.
To protect your business, always verify the authenticity of loan offers and never provide personal or financial information unless you are certain of the source's legitimacy.
What to Do If Your Business Was Scammed
If you found this article helpful, read also What Key Cyberthreats Do Small Businesses Face?
The more you understand what is happening, the better decisions you make to safeguard your company and customer data.
Related: 10 Cybersecurity Tips to Protect Your Small Business Data
Bitdefender Ultimate Small Business Security is here to help you with comprehensive protection designed specifically for small businesses. Here's what it offers:
Bitdefender Ultimate Small Business Security is an easy-to-use, all-in-one, affordable solution that protects your business. Check it out at bitdefender.com/solutions/small-business-security.
tags
Cristina is a freelance writer and a mother of two living in Denmark. Her 15 years experience in communication includes developing content for tv, online, mobile apps, and a chatbot.
View all postsSeptember 06, 2024
September 02, 2024
August 13, 2024