Firms to combat ID fraud
Small firms worried about the risks of corporate ID fraud can now get advice from a free guide launched by Equifax.
The 16-page booklet Your Guide to Combating Corporate ID Theft & Fraud sets out common types of fraud and theft, and gives straightforward and inexpensive tips to protect a business.
According to Equifax, firms are in particular at risk from 'phoenix company' fraud, where a director sets up a business, then winds it up owing substantial amounts of money. Often, the director then creates another company operating in the same field but creditors are unable to recover their losses.
Another well-known type is 'long-firm' fraud, where an apparently legitimate company places a series of small orders with suppliers, paying promptly to gain their trust, before making several big orders and disappearing without payment.
Small firms, particularly, were often oblivious to the risks, according to Neil Munroe, Equifax external affairs director, who said that corporate ID fraud often slipped under the radar of business owners.
"Our survey of UK small businesses shows that although companies are aware of financial fraud, there seems to be a reduced perception of the risks of online and company identity fraud," he said.
"All forms of fraud present a very real threat to businesses, resulting in lost profits, lost reputation and the risk of bankruptcy," Munroe warned.
To reduce the risk of becoming a victim of fraud, firms should always check personal as well as business credit references, confirm the trading address and contact details of customers, and check rigorously for any connections to previous companies with similar or identical names, Equifax advised
