UK small businesses losing £9bn a year to fraud

Small businesses around the UK are being scammed out of more than £9bn a year by fraudsters, it has been revealed.

On average, small companies lose £1,658 a year to invoice fraud, whilst one in six small business owners estimates losses of more than £5,000 in the previous year alone.

Invoice scams: what to look out for?

Invoice network Tungsten surveyed more than 1,000 SMEs, finding that almost half had been on the end of a suspicious invoice or been a victim of invoice fraud - one of the most common tactics used by the scam artists.

Amongst the other types of fraud small business owners should be on the look-out for are viruses posing as bills and fraudsters who pretend to be suppliers.

What businesses are most at risk of invoice fraud?

In short, any type of small business. Whilst different types of business may fall victim to differing types of fraud, all small business owners should be mindful of potential risks.

A tradesperson, for example, may perceive their highest risk as the possibility of faulty cheques, while a company that deals with a lot of customer data should be on the lookout for potential phishing attempts.

Cheque and double-check

As Steven Mitchell of explained in the Telegraph, one tactic used by prospective fraudsters is to deny owning a credit card and insist on payment by cheque.

By accepting cheques, you run the risk of it being returned for nonsufficient funds or a closed account. However, if paying by cheque is the only option, small business owners would be wise to run it through a cheque guarantee service first.

When it comes to viruses posing as bills and other phishing tactics, vigilance is key. However, for a more in-depth set of guidelines, check out our tips on how to protect your business and your customers from phishing.

Have you seen or been the victim of fraud? Let us know about your experience in the comments below.

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