with Zach Gray, commercial director at DE Ford

ANY organisation, no matter how large or small, can become a victim of fraud.

Recent statistics show that fraud affects one in four small businesses every year.

In 2015 losses due to fraud were estimated at £18.9 million.

Financial fraud has become more advanced and today most, if not all businesses use email and online banking for their financial transactions. Understanding the risks you may face can be the first step to protecting your business.

Here are a few examples of how businesses can become the victim of financial fraud:

• Employees no longer work for the company but have retained the company assets/passwords

• Fraudsters writing to companies who are having work done, purporting to be the contractor, advising their bank details have changed. The company then pays the next instalment to the fraudulent party

• Fraudsters purport to be directors (by creating a very similar email address), and employees carrying out their instructions transfer fundsinto fraudulent accounts.

Putting simple security measures in place can help towards protecting your business and reduce the risk of you becoming the next target.

These include:

• Ensure controls in place for who can set up new fund transfers and who can amend fund transfers

• ALWAYS ask to verify bank details following instructions to amend the payee account (NEVER accept instructions solely via email or letter as these can be fraudulent)

• Change passwords when people leave the business

• Ensure you have firewall protection to prevent unauthorised access.

The insurance market has responded and policies can extend to cover for fraudulent loss - make sure your policy includes reference to ‘social engineering’ and ‘false presidents’ cover.

Zach Gray is the commercial director at D E Ford Insurance Brokers, providing bespoke insurance packages for businesses and charitable organisations.