Basic fraud prevention for small business

Four ways to protect your business from fraudsters

[May 8, 2008]

When you think of a small business, you think of hair salons, home-based distributors, repair shops, and so on.

But when fraudsters think of small business, they think of a place to generate their next fix.

According to Craig Brenden, fraud prevention officer for STCU, small businesses are a frequent target of identify thieves and other con artists looking for an easy way to purchase merchandise with bad checks, stolen credit cards, and false identification. Every small business owner should learn the basics of crime prevention to avoid becoming a victim.

“When dealing with customers, always go with your gut feeling,” Brenden recently told 150 business people gathered at a Spokane Valley Business Connections Breakfast. “If a transaction feels awkward or uncomfortable, there is no harm in performing some additional investigation.”

Brenden suggests four simple tools that small businesses can use to discourage fraud:

1. Ask for identification. Never perform a check or credit card transaction without valid ID.
2. Get a fingerprint on checks. A simple inkless fingerprint pad can be purchased at your local office supply store and are worth the investment. Fraudsters will hesitate to leave behind any means of identifying themselves.
3. Only process credit cards that are signed. The signature space provided on credit cards is one of up to two dozen security features on the typical credit card that protect consumers and business owners alike.
4. Slow down. Fraudsters are constantly in a hurry. If you take a little extra time, the fraudster will likely lose patience, get nervous, and leave before a transaction is complete.

Most consumers are delighted to do business with people who take extra precautions to prevent fraud. Integrating the precautions listed above into your everyday business practices will help protect you and your customers from becoming the next victims of a fraud.