Over two-fifths of business owners in the US aren’t protected against fraud

25 January 2022

The survey, undertaken by SEON, revealed what measures, if any, business owners have put in place to help prevent fraudulent activity.

You can view the full research here: https://seon.io/resources/risky-business-how-protected-are-us-businesses-against-fraud/

Does your company have an anti-fraud policy?:

Shockingly, almost one in five (19%) of all business owners surveyed said they didn’t know if their company had an anti-fraud policy in place and a further two-fifths (38%) of respondents said they didn’t have an anti-fraud policy.

Just over four in 10 (43%) respondents said they did have an anti-fraud policy in place – less than half of all the business owners surveyed.

Aside from a fraud policy, does your business have fraud defenses in place?:

The study showed that over two-fifths (41%) of respondents admitted they do not have any fraud defenses in place, while over a fifth (22%) said they don’t know if they have any fraud defenses in place.

Only 12% of businesses owners surveyed said they have taken every precaution to defend their business from fraud, and a further quarter (25%) said they have some fraud defenses in place.

Do you have insurance that covers fraudulent activity to ensure you are protected if your business becomes a victim of fraud?:

Almost a quarter (24%) of business owners said that they do have insurance that covers fraudulent activity. While there are many preventative measures a business can take to prevent fraud from happening if the worst does happen, it is great to know that your business is protected.

On the other hand, a third (33%) of business owners said they didn’t have insurance that covers fraudulent activity. If their business was ever subject to an attack, this could financially impact them greatly, and the business may not be able to recover.

Over four in ten (43%) of respondents said they didn’t know if their insurance covered fraudulent activity. If your organization has business insurance, it is crucial you check your policy to see what it is covered for. This will give any business owner peace of mind if anything, even non-fraud-related, should happen.

Further Findings:

• Under a third (28%) of all business owners included a definition of actions that are fraudulent in their fraud policies, with a further 17% also including an allocation of responsibilities for the management of fraud.
  
  
• One in ten (10%) said their business fraud policy encourages employees to report any suspicion of fraud, and less than one in ten (8%) included the steps to be taken in the event fraudulent activity is discovered and who is responsible for taking action.
  
  
• 32% of respondents said they do not train employees on how to detect, prevent and report fraudulent activity.

Tamas Kadar, CEO and founder of SEON, comments: “It is shocking to see how many business owners do not have an anti-fraud policy in place and even more concerning that business owners have failed to include key information in their fraud policies.

“With more businesses moving online or working remotely in the current climate, the space in which fraudsters operate has grown significantly. It is more important than ever for businesses of all types and sizes to ensure their fraud defenses are up, running, and implemented. It is also paramount to educate each person in the business on fraud procedures, because once employees are trained on business fraud policies, fraud awareness becomes every single employee's responsibility and helps to create the best line of fraud defense across a business.”