Mar 19, 2013 Dave King
Corporate identity theft has been an increasingly widespread issue in the United States and abroad, as criminals are beginning to target smaller companies at a higher rate than ever before. Additionally, it continues to be one of the most serious crimes in the nation, as the Federal Trade Commission recently released a report that revealed this issue created to most complaints in 2012.
What's more, the rate and damages of identity theft has increased substantially with the passing of each year, despite increased efforts of federal and state law enforcement officials to deter the crime. Since technology is evolving at a such a rapid pace, regulators have struggled to pass effective legislation and guidance for businesses.
However, businesses should take a proactive and comprehensive approach to ID verification to protect the integrity of internal information, as well as the data of clients and employees that could be used by criminals to steal identities. Between strong information governance policies, advanced cyber security software and adequate oversight of accounts payable and receivable, companies can deter the threat of identity theft.
Tips to avoid damages
Investment News recently reported that financial advisers should be specifically involved in the ID verification process, especially as the most devastating instances of the crime involve the hacking of money management systems. According to the news provider, all businesses should have tight and stringent document retention policies that include guidance on the destruction of sensitive materials.
Though many instances of identity theft involve cyber crime, thieves are still using traditional tactics, such as stealing documents from trash cans, to find sensitive corporate or personal information. The source explained that document shredding should be implemented for all financial and health documents, as these types of paperwork often include extremely sensitive information.
Further, privacy controls on social media sites should be a point of focus, as many businesses have fallen victim to fraud through channels such as Facebook and Twitter. Investment News explained that companies can avoid this threat by regularly updating passwords and checking social media channels for potential security threats persistently.
Identity thieves do not need a lot of information to steal large sums of money and ruin credit scores, which illustrates the importance of covering all systems and data.
Chamber gives guidance
The Island Packet recently reported that the Greater Bluffton Chamber of Commerce in South Carolina is providing guidance to local businesses regarding the best practices of ID verification and other ways to avoid identity theft. According to the news provider, criminals are increasingly stealing corporate identities through simple strategies, such as falsifying letter heads and posing as current employees.
The source explained that one instance of identity theft can lead to a snowball effect, where many affiliated parties will also be affected. This includes banks, customers, suppliers, creditors and many more.
The Island Packet cited a study from the Ponemon Institute that revealed data breaches cost businesses an average of $5.5 million per incidence in 2011. Other studies indicate that the prevalence and damages of data breaches have continued to increase through 2012 and the first several months of 2013.
The Chamber of Commerce explained that businesses should always immediately notify law enforcement officials, as well as regulators such as the FTC, following an instance of data breach, the news provider noted. While there are ways to avoid data breaches, no business or individual is completely out of the grasps of identity thieves today.
Experts believe that quick, well-planned and efficient responses to such crimes are the best ways to avoid serious damages following a hack. Enterprise decision-makers should implement information governance policies and the cyber security software necessary to maintain strong ID verification and anti-identity theft operations.