By now, people know what identity theft is, and business owners understand that they are responsible for protecting their customers from data breaches that could be used to commit identity theft. Did you know that the identity of a business can also be stolen? Due to the potential scope, it's an even more serious threat and can severely damage your business.

Can a Business Be the Victim of Identity Theft?

Yes, business identity theft happens and can be financially devastating to a company. It can occur a few different ways, with the crooks posing as business owners or managers as the primary form. Thieves try to access sensitive material like its tax identification number (TIN) and the owner's personal information so they can access the business' bank accounts, credit cards, and other financial accounts.

In other cases, the criminals might not get into the business' actual bank accounts but can fake being the business or its owners. The goal is to get cash, loans, or credit in the business's name, leaving it with debt while the crooks run away with the money.

Another option is gaining access to the business' website. This crime can range from getting access to the business' website name and then trying to sell it back to the company or hacking the entire website. If the crooks have also obtained access to the business' credit card and bank accounts simultaneously, they can collect money from orders, leaving the victim on the hook.

Other business identity theft schemes can involve –

1. setting up merchant [credit card processing] accounts in the name of the stolen business or even fake office space,
2. ordering products and services with stolen credit card info, and
3. filing counterfeit documents with the state to change the official business address and company officers.

The last scheme makes it easier for criminals to set up lines of credit with banks and suppliers.

Depending upon how they hijack your business identity, some criminals will even claim your tax refund. If they have your EIN, they file tax documents that qualify for a refund and pocket the money. Meanwhile, your business has technically filed a fraudulent tax return.

Crooks get the sensitive information that allows them to steal a business' identity through phishing attacks, scamming company employees, or even going through trash and recycling bins for account numbers and other helpful information. Practices like these are why shredding papers, particularly sensitive ones, are essential for business security and safety.

How Can a Business Protect Itself from Identity Theft?

Diligence and staying alert are essential to protect your business. Additionally, there are specific steps you can take to protect your business from identity theft.

1. Check your official business record with your state's Secretary of State office at least once a year to make sure it is accurate.
2. If your business address, company officers, etc. do change, update your information with the Secretary of State right away
3. Monitor your business' credit profile on Equifax, Experian, TransUnion, and Dun & Bradstreet. Report any errors.
4. Maintain essential paper records in locked cabinets.
5. Shred any document that contains sensitive information.
6. Use secure internet connections, like a VPN, and never use a public internet connection when paying company bills, accessing its bank account, etc.
7. Consider business insurance that covers any losses related to business identity theft.

Following these steps can protect your business from costly business identity theft. Establish a security routine and stay vigilant in following it to keep your business safe.

Protect Your Data with Storage Quarters

Good data management and destruction are essential to prevent breaches and identity theft. The data and document experts at Storage Quarters can help with all aspects of storing and digitizing your business information. Our information management specialists will keep your vital records safe and secure. To get a free quote or book our services, contact Storage Quarters today by emailing us at info@storagequarters.com or call us at (516) 794-7300.