Stop, Thief!

I just came across this frightening and interesting statistic: online fraud more than doubled to $559.7 million in 2009, up from $255 million stolen in 2008.

This should come as no surprise. Online purchases are a way of life. Just try buying some ordinary things, such as tires or wedding gifts at stores. Hardly anyone keeps inventory at each store, so you have to pay for things in advance and, preferably online. Moreover, as apps have become more popular, guess what? If they're not free, you need to pay for them by credit card.

In theory, it is very easy to detect fraud and to prevent future fraud with a sound strategy. But that costs money and most companies are not willing to part with it if it doesn't bring in immediate revenues. If you are a small business owner, you may not have much budget to combat fraud through the use of intrusion detection systems, but here are things you can do:

• Look for unusual account activity.
• Call customers to notify them if you suspect there is a problem. Give them the option of verifying their account activity before they receive nasty surprises on their statement. It will save you a lot of angry calls later.
• Arrange to have all revenues go in a deposit only account. You would be surprised that company employees innocently give away wiring instructions which have bank routing numbers and your company's account number to anyone who calls. It is easy for a thief to take money out once he or she has your company's account number.
  

You need to take this evolving security threat seriously or everything you worked hard to achieve will vanish.