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Top tips to protect your business from SME fraud

Top tips to protect your business from SME fraud - hero.jpg

Fraudsters are increasingly targeting UK small to medium-sized businesses. According to figures from banking industry body, UK Finance, SMEs lost £59.2 million to fraud in the first half of 2021 alone, an increase of 35%. 

For SME businesses over the past two years working remotely has meant they’re working outside of their normal processes, making it easier for fraudsters to impersonate chief executives, senior managers, suppliers and other individuals within the business.

A significant 80% of SME’s said they have received unsolicited texts or emails asking for personal information and money transfers, while 64% advised they have received suspicious phone calls.

We look at some of the most common types of fraud and the ways that businesses can prevent them.

Fraud warning signs to take notice of

The most common methods of fraud with SMEs tends to be CEO impersonations, overdue invoices or payments and mandate scams.

Frequently, fraudsters can attempt to impersonate not only internal individuals but also external businesses and organisations such, as alerts from ‘gov.uk/HMRC’, customer service teams from shipping companies or the World Health Organisation (WHO). Keep in mind these are only a few of the examples that you may be approached by!

When looking out for warning signs and to determine if the correspondence via email or text has come from a suspicious source, be sure to recognise a few of the common external alerts. For example:

  • ‘Charitable organisations’ with campaigns to raise money for research or funding support for victims
  • Services such as insurance deals, refunds and payouts or offering help and advice
  • Parcel shipping or redelivery alerts
  • ‘Tax refunds’ from gov.uk/HMRC and failed card transactions or overdue invoices

Remember to stop as the ‘Take Five to Stop Fraud’ campaign advises - often charities, insurance companies and shipping businesses will only reach out to those signed up to their marketing emails and newsletters.

Additional steps to protect your business from fraud

Stay vigilant and reject any unsolicited emails, texts and phone calls

Fraudsters will often try to persuade you to open attachments and links in their correspondence or attempt to cause panic and urgency to get information from you and can be successful in doing this by disguising themselves as a trustworthy source. Be aware of these methods not only via email and text message, but also social media and sponsored adverts.

Train employees on fraud scams

Educating your staff on staying safe and having a process in place on how to deal with scams with effective inhouse training and learning modules will raise your company’s safeguarding against fraudulent crime.

Ensure your computer is secure with the most up to date anti-virus and firewall software

Staying vigilant with who uses your computer and has access to your information will also help you and your business stay safe from fraudulent crime.

Carry out background checks with your suppliers, employees and other stakeholders

Have an idea and general knowledge of who you are dealing with by researching those companies you are planning to work with.

How Paragon helps protect you and your business:

  • We only ask for one, nominated bank account for sending and receiving money to help protect you against fraud
  • We ask you to keep us up to date with any changes in your details so we can easily stay in touch if needed
  • We will never send you an email or text message with a link asking you to login to an account directly

For more information on how to protect your business against fraud visit the Take Five website.

Paragon Bank PLC is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. Registered in England number 05390593. Registered office 51 Homer Road, Solihull, West Midlands B91 3QJ. Paragon Bank PLC is registered on the Financial Services Register under the firm reference number 604551