Home Billionaire's Club How To Spot And Prevent A Scam As A Business Owner

How To Spot And Prevent A Scam As A Business Owner


Business fraud and scam is on the rise everywhere especially in Nigeria, and it is mostly directed towards small businesses, some of them look so legit that if a business owner is not careful,  he or she might end falling for it without knowing.

According to statistics, fraud affects 1 out of every 4 small businesses every year, with SMEs losing an estimated $25.6 million in 2017.

It is therefore important to be scam-wise as an entrepreneur.

For you to be able to know and prevent a fraud or scam, you need to know the kinds of frauds that exists;

  • Cheque forging and Tempering
  • Compensation fraud
  • Expenses theft
  • Fake suppliers
  • Ghost employees
  • Accounts payable and receivable
  • Overbilling
  • Product substitution

These are in-house frauds that you need to be very particular about, however, there are so many types and manners of fraud when it comes to the general public and your business.

I have compiled a series of tips to help prevent your business falling victim to fraud

Know Your Customers and Their Identity

Vetting your customers is just as important as vetting your employees. Whilst most will make a genuine purchase, there are cases when customers want to rid you of your money. Failure to prevent customer fraud can result in profit and liability losses.

To prevent this you need to

  • Identify the threats
  • Be careful with card payment ( especially manually card details inputs)
  • Cheque fraud – only accept cheques from customers and suppliers you trust and always use a pen when writing a cheque and be sure to cross through any empty spaces, ask for an alternative payment if you feel the cheque doesn’t look right
  • Be careful of fake cash

Ask Yourself “Is It Too Good To Be True?”

If you get promises of a million leads, book sales, TV appearances, and speaking engagement, investigate, ask questions, and dig deeper, Manzanal-Frank said. “Their methods are as sleazy as their way to get your money in their pockets.”

Don’t be afraid to do the necessary work

Get-rich-quick schemes are many, and entrepreneurs should be wary of this. “Only hard work, persistence, and getting the right networks and connections can build your business through exposure, more leads, and media engagement,”



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