Protect Your Business from COVID-19 Fraud

During these uncertain times, there are several precautions that businesses must take to protect themselves, their employees, and their customers. Some of these preventative measures include keeping offices clean, working from home, and even closing businesses for the time being. But other threats that companies must now be on the lookout for are COVID-19 scammers. Fraudsters are using this time of uncertainty and vulnerability as an opportunity to exploit businesses of money and private information. Below are some common fraud schemes and how you can be on the lookout and protect your company.

Paycheck Protection Program Scammers

The Small Business Paycheck Protection Program is a loan designed to provide an incentive to small businesses (with less than 500 employees affected by COVID-19) to keep their workers on payroll during closures or hour reductions due to COVID-19. However, the Wisconsin Bankers Association is warning businesses to beware of scammers targeting program applicants. Scammers have been taking applications from business borrowers and using that information to commit fraud. To avoid these scams, business owners should work directly with their bank and should apply for this loan only through federally insured financial institutions.

 

Government Impersonators

Currently, government impersonators are some of the most common frauds that are circulating. Scammers are getting in contact with businesses through email, social media or by phone, disguising themselves as government officials or organizations. Some scams will ask for information so that you can receive your financial benefits. 

Often, these emails, posts and calls seem legitimate. Still, it is important to note that the government will not reach out to you or ask for personal information in these ways. In this situation, it is safe to assume that a scammer is targeting you in an attempt to hack your device or acquire confidential information. Do not respond or click on anything and report this activity immediately. If you are searching for up-to-date information from the government on the current pandemic, you should go directly to official government websites. If you are eligible to receive benefits, your government check will be mailed to you or directly deposited into your account.

 

Business Email Compromise Schemes

Business email compromise (BEC) is a scam that targets anyone who performs legitimate funds transfers. Recently there has been an increase in BEC frauds targeting those who purchase personal protective equipment and other supplies needed to fight against COVID-19. In a BEC scheme, you may receive an email that appears to be from a company that you typically conduct business with, but the company request funds to be sent to a new account or alter the standard payment practices.

To protect your business, the FBI advises that you be on the lookout for:

  • Unexplained urgency
  • Refusal to communicate over the telephone or video platforms,
  • Requests for advance payment of services,
  • Requests from employees to change direct deposit information, or
  • Last-minute changes in wire instructions, recipient account information, established communications platforms, or email addresses.

The FBI also recommends that you verify any changes and information via the contact file (not the number provided in the email), ensure URLs provided in emails is associated with the business is claims to be from, be alert to hyperlinks that contain misspellings and verify the email address used to send emails.

 

Investment Fraud

Another way that scammers have disguised themselves is as sources claiming to have a vaccine or cure that you can invest in. While there are ways you can donate online, ensure you go to a reputable source. And remember, companies that are working on coronavirus treatments will not reach out to you individually requesting money.

 

How can you protect yourself and your business

Use caution with online communication and make sure to verify the sender. Exercise caution when opening links or attachments. Hover your mouse over a link before clicking on it to see where it will send you. Make sure to go straight to legitimate sources when looking for information. Be wary of anyone offering medical advice or treatments, claiming to have job or investment opportunities, or anyone asking for personal information or money. Make sure that your employees know proper procedures for reporting a suspicious email, and keep them up to date on common scams. For medical information, go to your doctor or pharmacist, cdc.gov, or a local health department. For financial information, go to ftc.gov or irs.gov. If you come across a suspicious email or message, report it to the FBI at tips.fbi.gov or the Internet Crime Complaint Center at ic3.gov.

 

FBI. (2020, April 6). News: FBI. Retrieved from FBI: https://www.fbi.gov/news/stories/protect-yourself-from-covid-19-scams-040620

FBI National Press Office. (2020, April 6). News: FBI. Retrieved from FBI: https://www.fbi.gov/news/pressrel/press-releases/fbi-anticipates-rise-in-business-email-compromise-schemes-related-to-the-covid-19-pandemic

 

Cybercrime & Bank Fraud: Tips for Protecting Your Business

Topics: Risk/Fraud, Financing, General Business

 

 

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Views provided in this blog are general in nature for your consideration and are not legal, tax, or investment advice. Investors Community Bank (ICB) makes no warranties as to accuracy or completeness of information, including but not limited to information provided by third parties, does not endorse any non-ICB companies, products, or services described here, and takes no liability for your use of this information. Information and suggestions regarding business risk management and safeguards do not necessarily represent ICB’s business practices or experience. Please contact your own legal, tax, or financial advisors regarding your specific business needs before taking any action based upon this information.