Identity theft is an unfortunate reality for consumers. In today’s environment, it is very easy for a thief to steal your personal information, including your social security number, and begin to charge up debts using your identity. Even if you are careful about where you share your social security number and are diligent about shredding all documents containing personal information, your identity can still be compromised. All it takes is your laptop or smartphone being stolen or a company you use having a data breach and you are open to identity theft.
What many people may not be aware of is that business identity theft is also on the rise. This type of theft is also called commercial or corporate theft, and just like personal identity theft, it occurs when a thief uses a business’ line of credit for himself to open offices or merchant accounts. If business identity theft goes on too long without detection, it can be difficult to recover, and a business could potentially go bankrupt.
How to Protect Your Business from Identity Theft
The steps you need to take to protect your business are very similar to those you take to protect your personal identity:
- Shred paperwork containing sensitive data. If you have paperwork with information that could compromise your business’ identity, shred it. However, make sure you use a confetti shredded instead of a strip shredded so the paperwork can’t be pieced together.
- Regularly order a copy of your business’ commercial credit report.
- Sign up for electronic notifications through your banks and creditors.
- Have a set of procedures to follow if a business credit card is lost or stolen.
- Report any suspicious activity immediately to your bank or creditor.
What to Do If You Suspect Your Business’ Identity Has Been Compromised
Again, the steps to follow if you think your business’ identity has been compromised are very similar to the steps you would take if your personal identity was stolen:
- Contact the police and file a police report
- Contact all of your banks and credit card issuers as well as anyone else your business may have credit with
- Speak to the fraud department in credit reporting agencies and place a fraud alert on your accounts.
Just like personal identity theft, cleaning up your business’ accounts can take a long time. Unfortunately, the damage to a business can be even more severe than to an individual, so it is important that you protect your business’ identity.
Consider Investing in Credit Monitoring
Some of the credit reporting agencies, including Experian, will monitor your business’ credit report for a fee. They will notify you in the case of suspected fraudulent activity, which can help you stop the fraud before it spirals too far out of control.
Just as you must be diligent to monitor your own personal credit and be wary of identity theft, so, too, must you with your business. The effects of business identity theft can be dire and may eventually lead to the end of your business. Taking the steps to prevent business identity theft is essential.