21st century crime protection
Our unLTD columnist says the modern world calls for a different type of protection against crime
As we all know, the traditional picture of your business being broken into overnight by guys in balaclavas has been changing for a number of years. So what kinds of crime, theft or fraud are most relevant to businesses in the 21st century and how can we protect ourselves?
Employee theft/fraud
This is something that few of us want to consider or admit to being a problem – however, it is one of the most likely causes of theft within a business. The loss to UK business in 2016 was more than £40m due to employee related fraud and these are only the reported statistics so are likely to be just the tip of the iceberg.
Employee fraud can take many forms, from a simple theft of office stationery or stock, financial fraud within an accounts department, or even within a sales team generating false orders or selling stock off the books.
Cyber Crime
This doesn’t just mean receiving a virus or malware attack but also more sophisticated social grooming of employees, fake invoices and fake director scams.
This is a particular issue for SMEs who don’t have the infrastructure in place to fully protect themselves, and this has also been an issue for a number of my clients in recent years.
A particular favourite of the fraudsters is the fake email from a business owner asking someone in the business to set up a new supplier or for money to be transferred to a fake account. Often within an owner operated business, people don’t ask questions of “the boss” and so simply set up the payment.
Another major issue is invoices being intercepted and bank details being changed or a fake email coming from a genuine supplier advising of a change of bank details.
If your business loses money in these circumstances there is often very little your bank can do as you have intentionally paid the money over. Once it hits the account in the UK it is immediately transferred offshore with little or no prospect of recovering it.
Risk Management
This doesn’t have to be complicated and the best way to avoid a problem is to give it some thought and put some simple procedures in place to mitigate against the risks.
One of the most effective strategies is just to ensure that there is verbal confirmation when setting up any new suppliers or if there are any changes of bank details, just to make sure that any written instructions are from the person they are supposed to be from.
Most of the kinds of crime highlighted above are not covered by traditional insurance policies, however there are specific Commercial Crime policies that would protect your business in all of these eventualities.
Please get in touch if you would like to know more.
Sam Leeder ACII
Director
Actus Insurance
