Consumer identity theft is the primary focus of many government investigations. However, an ages old identity theft problem is still being perpetrated on small businesses. Once called the bust-out jobs perpetrated by the mob, small business identity thefts have now reached areas like Michiana and are performed through cyberspace by characters unknown.
The Traditional Bust-out
An identity thief that moves into the same building as yours performs the bust-out or the address is “borrowed” and the mail rerouted to a P.O. box. The thief opens credit accounts in your name, spending money on items that are then resold or credit cards that are spent until they max out. More sophisticated criminals are able to take out loans on your business credit.
After the cards are maxed out and the loans default, the criminal is usually long gone. Bill collectors usually find you, the true owner to pick up the pieces. Business owners usually find out about the scheme at the same time that their real business is being shunted to court for collections.
Modern Business Identity Theft
Modern methods work just like the infamous bust-out. The business identity is stolen, however, without needing to move to a suite adjacent to the business. Instead, the thieves get to the information needed to snatch your business credit by hacking your computers and networks. Just a few key pieces of information are needed to complete a credit application, so it is important to be vigilant and spot the crime before the collections companies come calling.
Three Ways to Stop A Business ID Theft
- Pay attention to your mail. Companies will send correspondence to the physical address of the business. If you see something strange, like a newsletter for certain credit card holders (and you aren’t one) or mail welcoming you as a customer, take note and then pick up the phone to confirm.
- Check your credit. Contact the same credit reporting agencies that monitor personal credit. Along with agencies like Dunn & Bradstreet, they can determine if your credit has been breached. Place alerts or flags on the credit if possible.
- Keep your private information close. Do not throw away un-shredded sensitive materials, use firewalls and smart internet usage techniques and carefully screen employees to prevent hiring thieves.
In the event of a security breach, don’t forget that you must, by law, report the theft to your customers. They have a right to know when and if their personal information has been compromised.
Prevention
Prevention is best way to make sure these thefts are avoided. For additional methods for keeping your identity to yourself, read the following advice pieces.
- Small Business Identity Theft and Fraud
- Taking On Small-Business Identity Theft
- Identity Theft: The ‘Business Bust-Out’
