They say running a small business is like juggling flaming torches—except sometimes, someone tries to steal your wallet while you’re doing it.
In this publication, we're uncovering a scam that has been making waves and could potentially affect you or someone you know. Let’s dive right in.
Small Business Scams on the Rise: Are You at Risk?
A recent survey by the NSW Small Business Commission has revealed a troubling trend—small businesses are being relentlessly targeted by scammers. With one in nine small business owners falling victim in the past year, and nearly 30% experiencing attempted scams every month, it’s clear that vigilance is more important than ever. Even more alarming, for some, these scams have led to financial losses exceeding $50,000.
How It Works
Scammers use a mix of deception, cyberattacks, and psychological manipulation to steal money and sensitive information from small businesses. Their tactics include:
- Phishing Emails & Fake Invoices – Fraudulent emails impersonating vendors or clients trick businesses into making payments to scammers.
- Business Email Compromise (BEC) – Hackers gain access to a company’s email and pose as executives, requesting urgent wire transfers.
- Ransomware Attacks – Cybercriminals encrypt business data and demand payment for its release.
- Overpayment Scams – Fraudsters “accidentally” overpay for goods or services and request a refund before the original (fake) payment bounces.
- Tech Support Scams – Fake IT professionals claim to detect viruses on business systems and demand payment to ‘fix’ non-existent issues.
Who’s Targeted?
Small businesses are particularly vulnerable due to limited cybersecurity resources. Companies in regional NSW are at even greater risk, with one in seven falling victim in the last year. Scammers target industries ranging from retail to professional services, often exploiting the trust between business owners and their suppliers, clients, or employees.
Real-Life Example
One NSW business lost $66,100 after an employee unknowingly logged into a fake banking website, providing scammers with direct access to company funds. Another case involved a fraudulent invoice payment that cost a small operation over $50,000, proving that even seemingly routine transactions can be exploited.
Why You Should Care
Beyond financial losses, these scams damage reputations, disrupt operations, and cause immense stress. A single compromised email or fraudulent transaction can set a small business back months—or even force it to close. With scams becoming increasingly sophisticated, no business can afford to be complacent.
How to Protect Yourself
- Educate Your Team – Train employees to recognize scams, verify suspicious emails, and report any red flags.
- Implement Multi-Factor Authentication (MFA) – Secure email accounts, banking, and financial transactions with extra layers of protection.
- Verify Payment Requests – Always confirm bank details with a known contact before transferring funds.
- Regularly Update Software & Security Systems – Outdated systems are an easy target for cybercriminals.
- Use Unique, Strong Passwords – Avoid using the same passwords across different accounts and consider using a password manager.
Quick Tips & Updates
Did you know? Cybercriminals often target small businesses because they assume they lack robust security measures.
Pro Tip: If an email or phone call requests an urgent financial transaction, pause and verify the request through a separate, trusted communication channel.
Stay safe, stay informed, and keep your business scam-proof!
Definitions of Key Terms:
- Phishing: A cyberattack where scammers impersonate a legitimate entity to steal sensitive information.
- Business Email Compromise (BEC): A scam where attackers gain access to a business email account to conduct fraud.
- Ransomware: Malicious software that locks access to data until a ransom is paid.
- Multi-Factor Authentication (MFA): An extra layer of security requiring two or more forms of verification before granting access.
- Social Engineering: Psychological manipulation used by scammers to trick people into revealing confidential information.
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