Rise in Identity Theft Fraud How to Protect Your Business

Oct 27, 2023

Identity theft has risen dramatically recently, with identity thieves evolving and becoming even more sophisticated and cunning with their attacks—making use of recent global problems such as the cost of living crisis to gain access to data.

According to the National Fraud Database, identity theft fraud accounts for nearly 70% of all fraud cases and rose by almost a quarter in 2022.

Research carried out by Cifas showed that 2022 had the highest number of fraud cases ever recorded (409,000) and that 68% of these were identity theft, an increase of 23% from the previous year.

Individuals over the age of 30 and especially over the age of 60 are more frequently targeted but businesses are also key targets for a number of reasons.

Why are Businesses Frequently Targeted in Fraud Cases?

There are several key factors that influence the fraudsters’ reasoning for targeting businesses as opposed to individuals, these include

  • Businesses and organisations typically have large amounts saved in their accounts 
  • Higher credit limits would normally apply to businesses
  • Companies regularly carry out large transactions without any inherent suspicion 
  • Information is often readily available on their company site or elsewhere on the internet such as social media

How Identity Theft Has Evolved 

As alluded to earlier, the techniques of identity thieves have gotten even more cynical and sinister in the way they capitalise on natural disasters and people’s vulnerabilities and insecurities in times of need. 

As unemployment rises, so too will recruitment scams as identity thieves and cyber criminals recognise the opportunities this presents. During the height of the COVID-19 pandemic, there was a wave of scams where the perpetrator would attempt to impersonate health organisations and medical bodies such as the NHS in order to gain access to victim’s data.

Similarly in the more recent cost of living crisis identity thieves are basing their approach around that issue, imitating lenders and banks and offering financial security and relief.

More frequent use of the internet in general has opened the door to more risk from identity theft with the FTC reporting that currently 62% of all identity theft fraud cases are as a result of email scams.

What is Business Identity Theft?

Business identity theft is when a criminal steals the identity of the company itself and uses it to purchase items or services by establishing lines of credit with banks and financial institutions.

By posing as the business themselves they are able to acquire larger amounts in transactions than they would if they presented as an individual account holder.

How can Businesses Protect Themselves From Identity Theft?

Secure Business Data 

The first step to take as a precaution against business identity theft is to ensure that you do not share any information about your company that could put it at risk, either online, publicly or in private conversations with other parties.

A good strategy to ensure that employees follow the correct procedure with regard to this is to have a data security policy that outlines what staff should look out for and governs their social media use in terms of company information.

Some firms will also elect to have staff sign non-disclosure agreements on company information so they are further protected under law from any leaking of company data.

Audit Accounts Regularly

To keep yourself informed and alerted to any suspicious activity, it is important to carry out regular audits on all accounts, credit reports and information related to business registrations and compliance.

This will mean that any sudden or suspicious change will have a greater chance of being highlighted and acted upon.

Install Cybersecurity and Anti-fraud Tools

In order to retain a robust defence against identity theft it is essential to have installed up-to-date cybersecurity tools or anti-fraud software [link to article - Top 12 Cybersecurity Tools].

Investing in tools that can assess risks and identify fraud and suspicious activity is always a wise decision. Software-based fraud detection systems can identify issues and irregularities that would be imperceivable to any human oversight.

Perform Regular Security Operation Monitoring

On top of the essential cybersecurity software, businesses can add an extra layer of security and oversight with live security operation monitoring and infrastructure analysis.

At Lyon, we have dedicated teams of analysts who can continually monitor all components of the network and security systems to remain alert to any inconsistency or threats. 

This means in the event of a data breach that could lead to identity theft, the engineers are able to be notified in real-time as the event progresses and swiftly respond to any threats and take the appropriate action.

Rigorously Test for Risks From Human Errors

As human error is the leading cause of all data breaches it is essential to safeguard from this by having appropriate staff training but also to test competency and adherence to procedures at all levels.

A good way of achieving an effective test of all security procedures is through penetration testing. This is a type of simulation that mirrors the methods used by cybercriminals and is performed by specially trained penetration testers. More details about penetration testing and how it works can be found here on our information pages.

Get Support From Qualified Experts

One of the dangers that increase a company’s exposure to risk from business identity theft is the decision to have cybersecurity matters handled in-house by existing staff.

Lyon provide expert cyber analysts who can not only respond to live or incoming threats but also proactively assist businesses and ensure their preparedness for any cyber attack, including identity fraud theft.

This means being a point of contact to liaise with business owners and advise them on any security measures or protocols, taking them through any installation or setup process, and advising them on which systems and security measures would be most appropriate for their business.

For more information on how Lyon can help your business stay protected from identity theft fraud and a wide range of cybersecurity threats, please get in touch today and our friendly advisors can take you through all the steps needed to help secure your business.