How to Detect Fraudulent Service Providers and How to Avoid Them Before Engaging in Business

It’s not just individuals that are vulnerable to scams, but businesses too. Many B2B companies such as service providers have been popup companies with a fake portfolio and testimonials, offering a service such as a virtual terminal to facilitate MOTO payments, yet will steal such sensitive data that it is processing. Whilst this is quite elaborate, more simple ones will be merely aimed at acquiring the business credit card details of the company itself.

This article will go over some actionable ways that you can go about preventing doing business with fraudulent services providers.

Have a skeptical mindset

First and foremost, always remain skeptical. Whilst this isn’t the most actionable way to start this list, you can certainly develop this mindset through constantly reaffirming the idea to yourself and your team of staff that if something sounds too good to be true, then it likely is. The validity of all companies, deals and information should be doubted at first. A presumptuous and trusting mindset can lead to you being exposed.

Use secure sites

This is an easy one to remember: only use secure sites. This means that they have been independently checked and verified. You may have heard of SSL, it stands for Secure Sockets Layer. Having one will turn a HTTP website into an HTTPS one, and you can see that from whether it has a padlock or not next to the URL like the following:

Become aware of the common schemes

Read up on the latest schemes that are going around. If a person or business that you have a relationship with has been scammed, then ask them for more details about it and how they got sucked in. You can also visit your government website or appropriate regulatory bodies for more information on the latest scams. The more you read stories on those who got scammed, the stronger your pattern detection abilities will be for when you come across them for yourself. After all, fraudulent “companies” certainly have similarities in their behaviour and appearance, so you need to become familiar with these traits.

Teach fraud detection to staff

If you’re a company that’s engaging in business with other companies, it’s not just you that has to be aware, but all of your employees need to be too. It’s difficult to have everyone reading the latest scams and having such a mindset. Instead, the basics of avoiding scams needs to be taught. How to stay safe, when not to hand over sensitive data, the importance of secured sites and so on. The last thing you want is an employee handing over the company’s credit card details to someone via email or telephone.

Ideally, you will develop a strategy to teach fraud detection. Those in HR should put together a training course that could be held a couple of times per year. Alternatively, staff could be pointed towards external e-learning resources twice a year, such as an online course in fraud detection. This would make it easier for employees to learn remotely, at a time they see fit.

Never hand over bank details via email

A definite no-no is to hand over the company credit card details over email or the phone. No company will ever ask you for your PIN number, so this must be disregarded in any and every situation. Additionally, you have to be super careful with MOTO payments, making sure that you only use them on extremely trusted parties.

Any signs of a service provider asking for a bit too much information than usual, or your card details, is a red flag. This is when you should stop everything immediately and research this company more.

Invest in cyber security

If you’re a business, you will certainly be handling sensitive data. It might be worth investing in some cyber security (outsourced if necessary) to ensure that you can prevent cyber attacks. Likewise, information and systems should always be backed up in case of such an event. This also means having strong passwords and not writing down sensitive information on paper.

Secure your property

Likewise, whether a business has an office or highstreet store, you should always make sure they’re secure. This means CCTV, not leaving laptops and sensitive data in reach of visitors and so on. Visitors to the property must be checked in, signed and recorded when leaving.

Most conclusively: Search for online reviews of the service

The above ways will help prevent your company from getting scammed, but you may never have known for sure. Actually searching the service on Google with the suffix “reviews” and even “scam”, should bring up results that could confirm your suspicions. Take TransferWise as an example, it has almost 2 million review results in Google.

If nothing comes up, then this is a little odd too. An established business would surely have backlinks and references from other authoritative sites. Even social media such as Reddit can give you a great feel for a company too.

There are many company reviews sites and companies dedicated to reporting scams. Furthermore, if you were cold called regarding a service that you’re interested in, it is worth Googling this phone number. Those who get scammed frequently post the numbers in which they called from. This acts as a crowdsourced network of fraud detection, and it works very well, so it’s important to make use of it.