Corporate ID fraud on the rise

According to the Federation of Small Businesses (FSB), rising numbers of small firms are not protecting themselves against corporate ID Fraud. As a result, the FSB has written to Companies House to prompt tougher action.

The Metropolitan Police has also recently launched the St£rling Proactive Prevention Team to combat the growing threat of corporate identity theft. However, Equifax recommends businesses still need to take stringent precautions to avoid falling victim to fraud.

Wayne Davies, Head of Commercial Product Development at Equifax comments, “In each case of Corporate ID theft there will be at least 2 victims, the company that is being cloned and any other company that then supplies goods or services to that cloned company.. Common sense and due diligence are key to preventing businesses from becoming one of these victims.

“Companies should use a cost efficient, accurate, and timely monitoring service such as the Equifax Portfolio Monitoring Service. This works by alerting a dedicated contact (s) within the company to any changes they choose in the information held on their own company (or group) and on their customer base.”

The FSB is concerned with the procedures at Companies House, which only keeps a record of the documents it receives and doesn’t check these for accuracy. Companies House has no legal right to question applications it receives to update business details, yet incorrect information, even as a result of fraud, can only be removed through a legal judgment, which can lead to a costly legal bill.

“Corporate ID Fraud will continue to rise unless companies implement appropriate measures”, continued Davies. “Information and data is more valuable than tangible goods and the effect fraud can have on a business is not only time consuming but could damage the businesses reputation and brand value.”

By placing company details with the Equifax Monitoring Service, businesses can create tailor made profiles that focuses on changes to their information that may identify the presence of fraudulent activity. A Portfolio Monitor alert will be triggered as new information becomes available to Equifax, highlighting elements such as changes to Registered Office, changes to company officers, new accounts being filed, a credit limit change, CCJ information and insolvency orders.

Davies concludes, “Companies who are put off verifying changes in customer accounts due to the cost of each check can use our Platinum Service as it isn’t cost restrictive. Under this service no matter how many alerts are generated or checks carried out on existing customers no additional charge is created. When dealing with new customers, companies using Equifax’s Optima Report will be alerted to all recent changes to Registered Addresses or Directors which again could highlight ID theft has taken place.”