Business identity theft has increased dramatically in recent years and has become a major threat to small businesses. Studies show that identity theft cost employers and businesses an estimated $56 billion in 2021 alone. Criminals make illegal profits on brand successes by carrying out impersonation attacks and stealing data. Small businesses are particularly at risk of this menace because they lack the resources that larger corporations have to protect themselves from cybercrime. Here are some steps to protect your small business from ID theft to stay clear of their damaging repercussions.
1. Get an employee identification number
It may surprise you that an employee identification number (EIN) can help protect your business from identity theft. How? An EIN allies you to separate your business finances from personal ones. Once you have your EIN, there’s no need to present your social security information to a vendor or a client before you do business with them. You only need to give them your EIN to prove your business credibility. This way, you can keep your social security number private and minimize the risk of cybercriminals stealing your details and making away with your hard-earned money. So if you don’t have one yet, apply for EIN number as soon as possible.
2. Go paperless
A great offensive approach to protect your small business from ID theft is to go paperless in your operations. Ensure that sensitive information like your bank statements is sent to you through email, not your address or physical mail. Install anti-malware and antivirus software with a firewall to protect your online data. You might also want to invest in a paper shredder to dispose of all financial documents instead of throwing them into the garbage can.
3. Establish some customer relations policies
Believe it or not, some cybercriminals can portray themselves as customers or potential business partners looking to do business with you. Using some customer relations policies to protect your business is a good way to prevent such pretenders from catching you off guard. For example, you can ask any client who wants to pay you with a check or credit card to provide a photo ID. If the photograph on the ID does not resemble the customer or looks fake, that’s a red flag. Also, if the customer’s signature does not match the one on the photo ID, that’s a sign that you shouldn’t accept payment from that customer.
4. Check your company’s credit report
Consider checking your company’s credit report regularly to look for suspicious activity that might indicate identity fraud. You can also consider hiring a fraud monitoring service to regularly inspect your company’s credit report for unusual activities.
5. Educate your workers
You may not always be the direct target of an online criminal. Most ID thieves will look for weak links in your company, and these may be your employees. So, take the time to educate anyone who works for you about the importance of protecting against phishing scams and any other form of ID theft.
