Mitigating Financial Losses from Fraudulent Activities

Share on facebook
Share on twitter
Share on linkedin
Share on pinterest
Share on tumblr
Share on reddit
financial loss

Many of us are hard-working and law-abiding citizens who want to make an honest living income for our family and us. However, some individuals want to have their way with society, usually at the expense of others. In almost all facets of society, fraudulent activity is present.

But some of the most damaging types of fraudulent activity are usually present in business organizations. According to research and auditing agencies, businesses around the world will usually lose around 4 trillion dollars worth of revenue due to different forms of fraud. Most of the time, it’s small-to-medium business enterprises that are the most vulnerable since most invest in growth rather than safety and security.

Fraudulent activities can come in many forms. Whether it’s someone who’s leaking out sensitive personal information, directly stealing from company funds, or listing down passwords and other employees’ credentials to other businesses, these activities can be devastating to many organizations and companies.

That said, it’s more crucial than ever that business organizations and conglomerates invest in equipment and strategies that can help minimize the likelihood of fraudulent incidents. Not only will fraudulent activities cause financial loss, but this can also be detrimental to employees’ safety and security. Here’s what you’ll need to know when it comes to minimizing financial loss for your business.

Consider Your Establishment’s Security

First and foremost, we’ll need to consider your establishment’s security since this is one of the most important ways to prevent financial losses from internal and external fraudulent activities.

Many businesses that handle a large amount of money throughout the day will usually be a target of many malicious entities. This is especially true for banks, convenience, and retail stores that get a good amount of foot traffic. Normally, these activities will come in the form of robberies and violent crimes.

In fact, insurance firms would say that most businesses can lose an average of one million dollars in a year just from theft that an employee is orchestrating. Small to medium enterprises are usually the ones that are hit the hardest by robberies, representing around 68% to 70% of cases.

If this is the case, you’ll need to invest in security equipment and personnel that can serve as a deterrent in this type of situation. Many businesses and federal establishments are known for using responsive and high-quality commercial panic buttons that can help notify authorities and stop crime in their tracks.

Protecting Your Company’s Data

Almost all of us want to live a private life while only showing the public certain parts of it. The same can be said when it comes to company-related information: important data should be kept secure while only a select group of individuals are allowed access.

Treating your business’s sensitive information with the same care as you would when it comes t your personal credentials is crucial in keeping data secure. Most organizations are always looking for ways of getting an edge over their competitors, and acquiring sensitive information from other businesses can help them get an advantage.

finances

Some types of fraudsters are well-versed in legally obtaining information that can help them utilize an individual’s credit through the use of a business name. It’s important to guard this information by utilizing monitoring services that specialize in credit.

Effectively Managing Your Passwords

Even when banks and companies have been investing in security software that can protect passwords and other personal information, there’s still a small likelihood that passwords can be attained by individuals looking for easy money. This is especially true among small businesses that don’t have the proper security software.

One of the most common trends among startups is having a predictable password that can be shared among employees. This can make it even more challenging to secure passwords since everyone, especially newer employees, will access critical information.

That said, employers might want to invest in password management. A password manager famous among freelancers and startups is LastPass. This helps share passwords, but only to a certain extent. For most individuals working remotely and won’t have any “physical” interaction with employers, this is a great way of sharing information while still being secure.

Various ways can minimize financial losses from fraudulent activities. What is the bottom line, then? You’ll need to be alert and maintain suitable security when it comes to the online operations of your business. Prevention is better than having to chase after malicious entities trying to harm the organization. You should take the necessary measures to ensure that your business is safe.

Sign up for our Newsletter

Scroll to Top