Wednesday, October 12, 2022
“You’ve been compromised.”
Those three simple words keep business owners awake at night. And for good reason.
The Association for Financial Professionals estimates that 71 percent of companies have received fraudulent attempts during the past year.
Ensuring the secure transfer of funds is essential for any organization. The AFP survey also identified real estate as one of the three most often-targeted industries by criminals (in addition to construction and commercial services). It also points out where business fraud is on the rise, increasing more than tenfold over a two-year period.
The factors behind this high-risk industry gives us pause and think of state and local governments, given the common factors real estate firms share with many cities, towns, and schools:
- They involve large dollar transactions.
- They have easy access to public records.
- It is easy to impersonate someone via email; and, in both industries, there is oftentimes a lack of strong authentication processes.
The public sector houses some of the hardest working professionals we’ve had the pleasure of working with. However, it is an industry subject to potential turnover framed by heavily scrutinized budgets. It is key for staff to be armed with fraud education and cybersecurity resources such as multi-factor authentication and other fraud prevention tools.
When you add the current strained and volatile economy to the risk profile of many municipal governments, it could be argued that the risk of fraud schemes will only increase in 2022 due to distraction, unpredictability, and chaos. Extra vigilance is required by Hoosiers in today’s economy, and we should all task ourselves with mitigating cyber risks both at home and at work.
At Regions, we recommend that organizations implement a multi-layered approach, leveraging education and information sharing with an internal process driven by best practices, along with utilizing external resources.
- Begin by talking with your banker about the best safeguards against fraud, including products like Positive Pay and ACH Alerts. Be and stay curious.
- Carve out regular time to educate yourself and your team on current fraud strategies (they never cease to amaze us).
- Create an internal team to conduct a thorough IT/infrastructure assessment to identify any potential points of compromise. Document your process and plan – you can leverage these free resources to help you.
- Implement an anti-fraud training program and internal controls using Stop-Call-Confirm and dual approvals to be more proactive. By adding some intention and dimension to your business practices, you are bound to reduce your risk, no matter your industry, something that allows all business owners to sleep more soundly each night.
Unfortunately, fraud isn’t going away because when big money is involved bad actors want a piece of the action. Protect yourself and your organization with ongoing education, training and multi-layer protections that make access difficult for scammers.