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Strategic Intelligence Vol:1 No:2

We Are Here To Help You

During the next few months, Strategic Intelligence will devote itself to providing you with everything you need to know about the issues facing business owners, with an emphasis on internal and external fraud.

We will focus on internal issues such as internal controls, asset management, hiring practices and employee education. We will also explore the increasing external threats facing business owners including check and wire fraud, credit card fraud, internet fraud and data breaches.

Rather than just producing a theoretical bullet list of issues we plan to introduce real life scenarios into this series, analyze them and suggest practical, cost effective countermeasures. We also encourage any general or specific questions or comments from our readers at any time!


Did you know...

For businesses with fewer than 100 employees, it is estimated that 1 in 4 fall victim to some form of fraudulent activity. According to a 2014 study by the Association of Certified Fraud Examiners (ACFE), the median loss was $147,000 and it went undetected for 18 months on average.

Most experts agree that it is virtually impossible to completely prevent fraudulent activity but we believe that, without being unduly burdensome and expensive, we can provide small business owners with an understanding of the issue and a number of basic tools and controls that will enable them to minimize the risk of fraud and aide in early detection.


Is it possible to make four exotic cars disappear in one day?

There is no end to what can be purchased online these days, including cars. It is becoming very common and easy for anyone to be able go online, purchase a high-end luxury vehicle through an online dealer and having it delivered to them, even if the customer is in another part of the country.

Recently, a client of ours, a brick-and-mortar car dealership with a heavy online presence completed such a sale. An out of state customer contacted them stating that the dealer had a Porsche with the exact specifications he had been searching for. After some communication back and forth, the dealer was thrilled to have a price that both parties agreed upon. Shortly after, all information and documents, including the customer’s drivers license and insurance were exchanged via phone and email.

The customer had a credit score of 840 and requested to finance his purchase. The dealer processed his application online and a national bank responded with a financing offer. The customer accepted, signed all the paperwork and arranged to have the vehicle delivered by an auto transportation service to his office. The customer worked in a very large corporate office and requested to meet the driver in the parking lot to take his delivery.

Now, if you are thinking that there is something fishy in this story then you, my friend, have the Strategic Intelligence to sense what happened next...

The customer was a con-artist! He not only took the delivery of the Porsche from our client but he also pulled the same scheme on 3 other dealers from different parts of the country! He completely vanished and went off the grid, along with the 4 luxury vehicles he “purchased”. The scam wasn’t discovered until several days later when the motor vehicle department found that the customer’s ID didn’t match their records.

Our client, the other dealers, the banks and the individuals whose identity were stolen are left to sort out the situation...


Now what can you do?

Remember that it is always important to be aware, cautious, and proactive to protect yourself and your business from online fraud. Here are 3 easy steps you can take:

1) If there is a purchase being made via credit card, it is always important to take the address verification code (postal code that relates to the cards billing address) and require a card verification code (3-4 digit code on the card).

2) Try to always check credentials of a new customer. If there is suspension with a regular customer, ask them about their past business with you to make sure it is them and their identity hasn't been stolen.

3) Make sure their delivery address is a valid and specific. Try to avoid vague addresses/areas like parking lots or P.O. Boxes. Always make sure all firewall settings and security is up to date on all of your systems.

Still concerned or have questions? FRGi offers a free consultation to new customers. Please feel free to reach out to us, we are here to help you and answer all of your questions.

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