How to Protect Your Business from Identity Theft

Introduction

You work hard to build your business, and you know how important it is to protect it from any threats that might interrupt your success. Identity theft could be one of those threats. Unfortunately, this crime has grown to the point where there’s no getting around its importance in today’s world, even if you’re not an individual personally affected by identity theft and fraud. Here are some tips on how identity theft can stop you and your business in its tracks and steps you can take to keep it from happening to you.

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1. Why It's Important

It’s important to consider how you can protect your business from theft. While identity theft isn’t as serious a threat for businesses as it is for individuals, it still happens. In 2016, identity thieves stole over $7 billion from businesses and made off with nearly $2 million per day (according to Javelin Research). There are many ways you can protect your business from ID theft, but you should start by asking yourself these questions: How easy is it for someone to steal my business's confidential information? What personal information do I store on my computer? How protected are my computers? Is there sensitive information that shouldn't be stored digitally? What processes do I need in place in case someone tries stealing my personal or business data?

2. Different Kinds of Threats

Although most people think of identity theft in terms of credit card numbers, bank accounts, and other such financial information, it’s also a danger that can impact your business. For example, if someone steals another person’s identity, they might gain access to your email account. If they have access to your email account and know you use Google Drive or Dropbox for cloud storage (for example), then they can copy anything on those accounts. From there, it’s easy enough for them to get their hands on any information related to your business—from client lists and strategic documents to payment details and product launch plans.

3.The Costly Consequences

Identity theft is a serious and costly problem that can have a devastating impact on your business. Once fraudsters get a hold of your personal information, they’ll try to open credit accounts in your name or take out loans. In fact, the average victim can spend up to $50,000 just trying to clear their good name and restore their financial standing (and identity theft victims report an average recovery time of about five years). It doesn’t take long for fraudulent activity in someone else’s name—and on someone else’s dime—to cause serious problems. Before you know it, someone has opened a line of credit at one of your suppliers without paying for it—or charged thousands in fraudulent expenses on one of your accounts.

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Introduction

4. What You Need to Know

The average cost of a data breach is $5.6 million, according to research by IBM Security and Ponemon Institute. As a business owner, you need to know that identity theft can have serious consequences for your business: lost money, lost time, and lost productivity. Here’s how thieves can hurt your business

5. How Can You Stay Safe?

Small business owners need to be on high alert for identity theft because criminals know that small businesses are prime targets. These days, it’s not enough to take preventative measures like passwords and locks—you also need a plan for what you’ll do if your business is hit with a cyber attack. Start by conducting a risk assessment of your business: How does identity theft occur? What data is stored in your company? Which of those data sets are particularly vulnerable? Once you understand where your vulnerabilities lie, you can begin implementing protective measures.

6. Summary

A successful business depends on many factors including trust. Without trust, you won’t have customers. You lose your reputation, and without a reputation, you can’t survive in today’s economy. With all of these things at stake, how do you protect your business from identity theft? How can you make sure that someone else doesn’t tarnish your reputation? In order to avoid identity theft it is important to understand how it works and what steps you can take to prevent it. This post will explain how identity theft happens and what steps you should take as an entrepreneur or business owner in order to avoid it altogether or recover quickly if something goes wrong.