How Businesses and Individuals Can Avoid Fraud

By: Austin Heeren, Vice President, Treasury Management Sales Officer

Fraud happens everywhere in today’s age. Between phone calls, texts and emails, everyone needs to be on the lookout for malicious scams. Fraudsters have a lot more tools at their disposal now to try and steal your information.

For both individuals and businesses, making sure you have the right safeguards in place to protect yourself from those scams is essential. As we continue to get smarter and use new tools to track down threats, so do fraudsters. Everyone has to stay on guard to protect themselves, their information, their money and their businesses.

Be On the Lookout For Threats

Fraud has evolved, and it continues to cost both businesses and individuals more money each year. Some estimates say cybercrime could cost $10.5 trillion this year alone. The biggest threat to security is the human component. It’s easy for us to fall into the trap of clicking a link we shouldn’t and letting the fraudsters in on our information.

The simplest way to avoid scams and frauds? Stay vigilant. Don’t click links you haven’t verified. Change your passwords regularly. If something doesn’t sound right, it probably isn’t. If you get a text from your bank asking you to click a link and enter your personal information, call the bank and verify that they’re the ones who sent it. If you get an email with a link to your work address and you click the link, the entire company could be compromised. Always verify what you’re doing or clicking is legitimate before doing so. Many fraudsters will create a false sense of urgency, saying you need to send money now or something bad will happen. In actuality, nothing is so urgent that you won’t have time to verify it’s real.

Evolving Technology and Scams

As our technology systems continue to adapt and advance, so do those being used by fraudsters. One of the newest ways this is happening is through generative artificial intelligence, and many are using this in ransomware attacks. The technology uses adaptive malware to get into a system, sometimes undetected for periods of time because it doesn’t look malicious at first, and it can then adapt and modify its own code to do the most damage possible at the most vulnerable time. Quantum computing is also being looked at as a future problem because of the ability to complete tasks in minutes, as opposed to hundreds of hours. This can be used on encrypted data that may have previously taken days, weeks or even months to get into, and now only takes a few minutes.

At MidWestOne Bank, we’re using a combination of our own products and AI systems to protect our customers' information. One example of this is using AI to pull a list of transactions and use patterns to identify when something doesn’t seem right. While it’s a game of chess against the fraudsters, we’re constantly bringing in people and resources to guard against malicious threats.

Proactive Measures To Take Now

For individuals and businesses, there are a few things you can do to ensure your information is safe. Change passwords frequently, and don’t use the same one. If it’s been compromised previously, that stays on the dark web forever. Multifactor authentication systems will also add an extra layer of security so fraudsters can’t get in with one piece of information.

For businesses, constantly evaluating policies and discussing protocol across the organization can help employees be aware of how they can be targeted and what to do if they do fall victim to a scam. Identify risks and how you would address each one. For business accounts, use dual controls so that two people have to approve logins or purchases. It’s also important to ensure that any vendors you’re working with have protective measures in place, so fraudsters can’t get into your information through the back door. Businesses should utilize positive pay to prevent ACH and Check fraud before it occurs. If you are compromised, alert your other vendors, your team and your bank as soon as possible to help mitigate the threat.

At the end of the day, it’s about being cognizant of every link you click and every call you answer. Protect your information, including passwords, closely at all times. While fraudsters continue to get smarter, so do we, and with your help, we can keep your information safe.