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Staying a Step Ahead of Fraud

Posted by IBS Marketing on Dec 1, 2021 4:43:04 PM

At Interstate Billing Service, we take the security of clients and customers seriously. Fraud prevention is an industry-wide concern impacting businesses worldwide. There are many areas of vulnerability which require extra vigilance. Here are just a few items of concern and suggestions for best practice worth passing along.

Credit Applications

Credits applications are the lifeline between your customers and the services you provide. However, there has been uptick of reports across the industry of fraudulent attempts to pose as people or companies in an attempt to steal goods and services through submitting fraudulent information. There are a few red flags you can look for when reviewing your credit applications.

  • Location - Be mindful of the location submitted by the applicant. Ask yourself if the customer’s location makes sense for your business footprint.
  • Email – Look for inconsistencies with email addresses, links, and company domain. Does the domain name match the name of the company email submitted? Typically emails with a .biz domain are fraudulent. Also, established companies do not utilize Gmail, Hotmail, or Yahoo accounts as formal business platforms for communication.
  • Misspellings – Look for simple misspellings, common spelling or grammatical errors throughout the application. This type of error may not just be unprofessional. It may indicate fraud.  
  • Odd formatting - There is a specific format to fill in dates that is second nature to anyone educated in the United States. Look closely at transposed dates that might indicate the person filling out the application is doing so from a foreign country and not, in fact, the local business they are representing.
  • Search Engine - Conduct a quick web search of the company and visit their website. A strong practice is to use a search engine like Google or Bing to search all contact information (addresses & phone numbers) on the application to make sure it ties back to an actual company. Fraudsters like to spoof official addresses, but often insert a dash or a break where one should not exist. If something doesn't seem right, call. However, call the number discovered through your search, not the number on the application.

Account Fraud

One of the most prolific means of account fraud happens after a product is shipped. Product recovery can be difficult once your item is in the hands of the wrong person and you could be left responsible for the cost. There is opportunity to prevent shipping fraud before it leaves your business.

  • Verify Drop-Ship address - Drop shipping is a method of order fulfillment where items are purchased from a third-party supplier but shipped directly to your customer. This is a popular way to serve your customer without having to stock inventory. Make sure receiving locations are what they say they are. A tip off could be a simple as a customer in one state asking you to drop ship to a state outside of their footprint. Are you in Michigan, are they in Indiana why are they having you drop ship to Florida? Make sure it is a legitimate company/customer, and make sure all the details provided make sense.
  • Require Legible Signatures on Invoices – Often signatures can look more like a scribble pattern rather than a legible signature. If there is ever any doubt on an invoice that involves a signature and whether it is authentic or not, be sure to verify it with the recipient. Ask them to resign their signature for approval. If the signature is still not acceptable, ask for a copy of their license to ensure the signature matches the information provided.
  • Know Your Customer – Develop relationships with the people you do business with most often. If a person says they work for a company you do business with, but you don’t recognize them, follow up and verify with the company.

Utilize Your Resources

You are successful in business for a reason. Make sure to rely on your intuition and the team you have built to help run your business. The bottom line is everyone in your company is responsible for fraud prevention. Speak to your customer-facing team members to ensure they know what signs to watch for in dealing with potential fraud. Make sure your team responsible for customer information and accounts receivable are vigilant as well.

If you suspect fraud and have further questions, rely on our team at Interstate Billing Service. We have the training and experience to help.

Topics: Cybersecurity, Business Management

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