There are different types of business identity fraud. The list ranges from fraudulent account purchase orders and employee identity theft to tax fraud, trademark ransom, phishing emails, look-alike websites, and the all-so-common fake social media accounts. The scariest part is that these are just a fraction of the identity fraud tactics that scammers are using to frustrate businesses today.
Identity fraud is so common among businesses that businesses lose a whopping $52 billion (estimated) annually. With such huge losses, having robust identity fraud prevention practices in business should be a top priority. Here are 5 best identity fraud prevention practices in business you can employ today:
1. Conduct Regular Customer Education
Educating your customers is one of the best ways to empower them against identity fraud. Some important pointers when talking to your customers about how to protect their identities are:
- Explaining how fraudsters can obtain your customers’ personal information, including phishing emails, public records, and even lost wallets.
- Caution your customers to avoid sharing personal information such as their credit card or social security numbers over the phone or internet.
- Encourage customers to use complex passwords for their online accounts and regularly update them.
- Ask customers to report any suspicious activity in their accounts or credit card reports.
- Regularly let customers know your legit online accounts (website and social media) and how to differentiate your real accounts from fake ones.
Don’t stop at educating your customers. It’s also crucial to keep your employees in the loop if there’s new information about identity fraud prevention.
2. Have a Thorough Know Your Customer (KYC) Process
You need a strict process to correctly identify customers. The best practices for a water-tight KYC include:
- Collecting basic customer identification information such as name, address, and date of birth.
- Verifying customer identification documents such as driving license, passport, and bank statements.
- Using face, ID, or biometric identification.
Most importantly, leverage a top-rated phone validation api for businesses from a reputable provider like Trestle so you can keep your contact databases clean.
3. Monitor Customer Activity Regularly
Ensure that you monitor customers continuously to identify and act on any suspicious account activity in time. Proactive monitoring also helps you tackle customer concerns promptly so you can maintain a positive customer relationship.
Implement methods for identifying and evaluating high-risk customers more often. These include, among others, customers who live in blacklisted areas, conduct high-risk businesses, or those with poor credit histories.
4. Keep Track of Emerging Identity Fraud Trends
The rise in complex identity fraud tactics can make it more difficult to catch fraudsters in time. Phone calls asking people for personal information are becoming quite the trend. Most of these are often part of larger fraud attempts, such as romance fraud and account takeovers.
Other common trends to look out for are swim swapping and call transfer fraud. While not so common, these are often a tad harder to detect and avoid. Staying ahead of such trends and having proper strategies to deal with them helps keep your business safe.
5. Invest in Advanced Identity Verification Tools
Advancements in technology have made it easier for businesses to fight identity thieves. There are various tools your business can invest in that can significantly reduce the risk of online fraud. Some of these include facial recognition technology, AI-powered fraud detection technology, and database verification tools.
Enhance Your Business’s Overall Safety
Identity fraud theft can have long-lasting effects on your business. Apart from the huge financial losses, you can also suffer a damaged credit score, a poor reputation, lawsuits, and the loss of customers. With the above 5 best identity fraud prevention practices in business, you can keep your business safe in 2025 and beyond.
Also, visit trelstleiq.com today to see the different tools they have for increasing the overall safety of your business, especially if you collect phone contact data or use phone calls as one of the most preferred methods of communication.
