Financial fraud refers to taking someone else’s money through deception. While technological advancements have made data systems more secure, they have facilitated fraudsters as well. It is critical that you stay aware and vigilant of the possible threats your company can face, such as identity theft and investment fraud.
Identity theft involves stealing one’s personal information to withdraw money on their behalf or engaging in other financially harmful practices. Advanced technology has made it easy to create the best counterfeit ID possible, and that can put businesses in danger if misused. Companies still follow outdated practices that put them at risk of such threats. Here are some factors that put your organization at an increased risk of fraud.
1. Lack of Investment in Cybersecurity
The evolution of technology has led malware to improve. Regular anti-virus software updates cannot control new viruses, trojan horses, and data breach tools. So, you need to invest in advanced cybersecurity software explicitly tailored for large organizations.
Unfortunately, new software is expensive, and companies either don’t have enough resources to invest in one or consider it unnecessary. Cybersecurity software doesn’t have an immediate benefit, especially for organizations that have never been defrauded or CEOs who disapprove of investing in costly cybersecurity tools. However, this makes the company susceptible to financial fraud.
New cybersecurity technology trends include Artificial Intelligence’s potential to scout for malware. The latest software also protects your cloud storage in addition to server-hosted data, so you need to utilize it to keep your company safe.
2. Bad Password Practices
You and your employees should never reuse passwords for different accounts or use easy ones. Since they are difficult to remember, most people use one password for several websites and use strings of characters easily guessable by software, such as ‘12345’. Or they check the ‘always stay logged in’ option or use password managers to enter their passwords automatically.
If employees practice these habits in your company, they risk data breaches which scammers can use to commit fraud. Password managers aggregate your data into one place, which makes it straightforward for hackers to access it. While secure password managers are convenient and safe, you must exercise due diligence when using one. Using the same password for several sites risks all your accounts if the scammers obtain even one password.
Prevent this by ensuring that all accounts and servers containing sensitive information use a strong and unique password. Eliminate the use of unsafe password managers wherever possible. Reset your passwords every month and avoid using default passwords for Wi-Fi and any IoT devices connected to the internet.
3. Remote Work
Remote work can raise the risk of data breaches. When there are multiple computers connected to your server, hackers have a wider net to cast. Employers’ personal devices also likely don’t have advanced cybersecurity software, making them vulnerable. Hackers can access company data if they access even one employee’s computer.
If your company uses a hybrid model, make sure you devise detailed remote work policies related to the use of the company server. These include giving employees a separate, encrypted connection for their work, which they mustn’t use for personal use or for IoT connections. IoT connections are particularly unsafe as a hacker introducing malware in even one device can compromise your central server. Your employees must be aware of the risks associated with IoT devices and use them only when required.
You must ensure the safety of your data, so you don’t fall victim to financial fraud. If your company’s data is breached, scammers can use this information to defraud your organization of millions. You also need to realize the importance of cybersecurity software by investing in one, eliminating bad password practices in your organization, and ensuring you don’t sacrifice security for user experience. Stay vigilant and invest in preventative practices so you don’t have any regrets later.