Small business identity theft is on the rise. To gain a little perspective, know that identity theft and related fraud rose 3.3% in 2021 to just over 1.43 million incidents. If that number sounds staggering, that is because identity theft is just that common. How are individuals obtaining your and your employees’ confidential information?
There are a few ways identity theft can commonly occur. Business identity theft typically occurs through phishing, W-2, delinquent utilities, and office supply scams, though scammers will find other creative ways to get through, too! Criminals have taken full advantage of the lack of security structures as people work from home more. 52% of small businesses experienced a cyberattack in the last 12 months. The average cyberattack cost for small and medium-sized businesses reached $2.9 million in 2021, an increase of 26.8%.
The Federal Trade Commission identifies these seven common scams that can impact small businesses:
- Public health scams
- Government check scams
- Business email scams
- IT scams
- Supply scams
- Robocall scams
- Data scams
It’s a good idea to update your IT team or employee responsible for any IT by having them trained to recognize the above scams. Policies can then be implemented so all your employees understand their IT security responsibilities.
Top 10 States at Risk for Identity Theft
Small business identity theft risk increases for some states more than others in the U.S. One reason is that some states have more access to governmental legislation than others. In reality, in some areas, Americans need to be more financially equipped to handle the strain of identity theft. The top states for identity theft are:
- Rhode Island. Identity theft complaints: 2,857 per 100,000. Total: 30,270.
- Kansas. Identity theft complaints: 1,355 per 100,000. Total: 39,461.
- Illinois. Identity theft complaints: 924 per 100,000. Total: 117,056.
- Louisiana. Identity theft complaints: 732 per 100,000. Total: 34,043.
- Georgia. Identity theft complaints: 618 per 100,000. Total: 65,666.
- Nevada. Identity theft complaints: 584 per 100,000. Total: 17,985.
- Colorado. Identity theft complaints: 583 per 100,000. Total: 33,572.
- New York. Identity theft complaints: 563 per 100,000. Total: 109,466.
- Delaware. Identity theft complaints: 560 per 100,000. Total: 5,449.
- Florida. Identity theft complaints: 515 per 100,000. Total: 110,675.
There are ways to protect yourself and your small business from becoming a victim of identity theft. We have tips for how to prevent a point-of-sale identity theft from happening to you to help. The FTC claims credit card fraud is the most commonly attempted identity theft, with 2.8 million reports in 2021. Scammers sometimes have already obtained a victim’s personal information and registered for a credit card with it! Imagine how this could impact your business if scammers are trying to open another business credit card in your name.
Having cyber insurance in place can help your business confront the financial realities of business identity theft and get your business back on track. B2Z can help! Contact us today.
