An enormous rise in business identity theft has happened in the past year. Criminals target businesses with fake attacks to make money off of the brands’ popularity without permission, which hurts the businesses that are targeted. Fourteen percent of businesses around the world have been victims of theft in the last 24 months, according to data from a research report. Therefore, business owners must move right away if they suspect any kind of company identity theft. This piece explains the various types of business identity theft, how they hurt companies, and what can be done to stop them.
Business Identity Theft: What Is It?
Business identity theft, also called corporate identity theft, is when someone illegally pretends to be a business. The target can be any kind of business with a Tax ID, from a sole proprietorship to a big company. Targeting organizations is common because:
- Their bank account amounts are higher
- Higher credit limits apply to them
- Frequent big payments are not strange
- Websites and the internet often have free information available
Practical Instances of Business Identity Theft
- Misusing Tax Information
Burglars can easily get the data they need. Some information might even be free to find online if businesses put out papers with info about the businesses themselves, like sales tax or business license numbers. Fraudulent tax returns are filed by business identity thieves to get refunds using information they stole from the company.
- Rendered Trademarks
Criminals could also take a company’s name or image and register it as a formal brand. In response, they demand a payment to return the protected business name.
- Creating Fake Bills
Someone stealing a business reputation could send a company fake bills with their company’s name on them, or they could pretend to be a business partner and send an invoice in their name, demanding payment.
- Fraudulent Social Media Accounts
Hackers make fake accounts that use real people, brands, or businesses’ names, pictures, logos, or other identifying information to trick others. Those recently made accounts might not be seen for a few days. People impersonating others using stolen identities take advantage of these times when people can’t see as much to attack customers with pushy fake advertising campaigns.
- Similar-Looking Websites
Fraudsters also often use copying the whole style of well-known company websites as another method. Unaware customers are taken to these fake websites by search engines, emails, or social media ads.
- Fraudulent Email Messages
The theft of a business’s name or image in emails sent by fake workers is a common example of identity theft. Hackers want to get a company’s banking information by doing this. Fraudulent financial activities can use this kind of information to get loans, credit lines, or credit cards in the name of the company.
KYB Practices Ensuring Safety from Business Identity Theft
Every year, businesses lose billions of dollars due to business identity theft worldwide. In addition to losing money, identity theft can lead to late payments and fines, cash flow problems, and not being able to pay workers and suppliers, file taxes, or buy materials. The business’s credit score and image will go down when this happens. To keep a business from falling victim to identity theft, companies must be proactive and teach their staff. Look over a business’s private credit report on a regular basis:
- Put in an email notice request with the bank and other service providers or creditors.
- After getting bills and account records, look them over carefully and report any strange behavior right away to the company that sent them.
- Keeping an eye on the company’s public records.
- Additionally, safeguard EIN (job identification number), account numbers, and other private data.
- Training employees on the best methods to preserve data is important.
- Avoid sending private data through email or any web-based tool.
- Purchase internet insurance.
In A Nutshell
Business identity theft affects tens of thousands of businesses every year. However, the most important factor is how enterprises deal with this challenge. Any kind of digital identity abuse can be fixed with KYB verification solutions. Know Your Business verification solutions allow businesses to ensure transparency by real-time corporate verification. Fraudulent websites, domains, social media accounts, and apps are found and removed instantly to keep clients and businesses safe from identity theft.