Business or corporate identity theft occurs when a thief uses an existing business’ name to obtain credit, or bills a business’s legitimate clients for products and services. Often, but not always, a Social Security Number of a company officer is required to commit business identity theft. Other identifiers, such as Federal IDs or Employer’s Identification Numbers are readily available in public records, dumpsters, or internally, and the relative ease of access to these identifiers facilitates this crime.
NPR reports “Business identity theft takes many forms. Posing as a look-alike or sound-alike business to lure customers is one of them. But in many cases, shady operators go after information to tap into business’ credit and reputation. They change a business’s contact information, for example, then use it to obtain credit cards or order goods, skipping town before bills arrive.”
Perpetrators of business identity fraud are often employees or former employees with direct access to financial documentation. They have the opportunity to pad the books in favor of their scheming.
Victims of business identity theft often do not find out about the crime until significant losses accumulate, or someone discovers discrepancies on the books Because of the hidden nature of the transactions, businesses can lose vast amounts of money. Business identity theft can remain undetected for years.
The most efficient ways to prevent identity theft is with an identity theft protection service and a credit freeze. This will only protect the business when everything is done under an officer’s name and Social Security number. Otherwise this crime is difficult to prevent. It is vitally important to do all the things a consumer would do to prevent identity theft such as shed documents, get a locking mailbox and make sure your network is secure.