Part 2: The Ways Fraud Actually Happens
(This is Part 2 of a 3-part series on small business fraud prevention, co-authored by Elevate Small Business and TD Bank USA.)
Fraud is rarely dramatic. Most of the time, it looks completely normal — until it doesn’t.
An Impersonator Tricks Someone into Sending Money
Impersonation scams can come by phone, text, email, or social media, with someone pretending to be a bank, a delivery company, or a trusted vendor, pressuring you into sending money or sharing account information.
Here is what it looks like in practice: a criminal sends an email that looks like it is coming from your bank, a vendor you work with, or even your own boss. The message feels urgent: “Please update our payment account” or “Wire this amount by end of day.” An employee moves fast, thinking they are helping. The money is transferred, and it is nearly impossible to get back.
Urgency is the trick. The moment you feel pressured to act immediately, that is exactly when you should pause.
Romance scams may seem unrelated to business, but they can still put small business owners at risk when a scammer builds trust online and then asks for money, gift cards, or access to an account. Fake tech support messages and package delivery texts can be used to steal login credentials or financial information. The common thread is the same: urgency, secrecy, and a request for money or personal information should always be treated as a warning sign.
A Link Leads Somewhere Dangerous
An email arrives that looks like it is from your bank, a shipping company, or software you use every day. Someone on your team clicks the link, types in their username and password, and without realizing it, they have just handed a criminal access to your accounts. This is called phishing, and one click from one person is all it takes.
A Fake Bill Gets Paid
A business receives an invoice for something that was never ordered or delivered. In a busy office where bills come in regularly, a fake invoice can slip right through if no one is taking a close look at what is being paid and why.
One Person Handles All the Money
This is the most common risk in a small business. When the same employee pays the bills, records the payments, and checks the bank account, there is nobody watching what they do. That does not mean every employee in that position will steal. It means there is nothing in place to catch it if they do — or if they make errors that go unnoticed.
Continue reading: Part 3: What You Can Do Starting Today | Missed Part 1? Start here.