Each year, a typical business loses an estimated 5% of its revenues to fraud, according to a 2024 study conducted by the Association of Certified Fraud Examiners. What’s more, the average fraud scheme lasts 12 months before it’s even detected.
With 2025 quickly approaching, it’s an opportune time to ensure you’re protecting your business against current and emerging fraud risks.
Sophisticated cyberattacks and deceptive use of artificial intelligence (AI) represent a growing risk for all businesses, yet check fraud remains the most common source of fraud. Nearly one-third of all small businesses in the U.S. were victims of check fraud in the previous year, according to the 2023 Mobile Deposit Benchmark Report produced by data security consultant Mitek Systems.
The most common check fraud strategy involves counterfeit checks that are produced from stolen checks. Once a fraudster has access to an account number, signature(s) and other check details, they can modify that check so it’s payable to another individual. They can also sell an original check on the underground market for use in creating counterfeit checks and ongoing electronic debit transactions.
Though checks represent the most commonly occurring fraud risk, the greatest dollar volume of fraud occurs in the digital realm. Business email compromise (BEC) encompasses deceptive phishing attempts and other ransomware-type attacks, with the primary objective of tricking victims into transferring funds to an account controlled by the attacker.
While most businesses are skilled in guarding against these fraud schemes, AI is quickly upping the ante. The growing sophistication of AI voice regeneration capabilities is making it increasingly difficult to decipher what’s real and what’s a highly accurate impersonation generated by a fraudster.
Here are several recommendations to reduce the risk that your business will become a victim of fraud in 2025.
Establish an internal system of checks and balances. Review your current payment processes to ensure you’re requiring dual signatures on checks and dual authorization on ACH and wire transactions. Implementing these checks and balances will also lower the risk of internal fraud.
Educate your finance and accounting teams. Ongoing training of your internal teams is vital to ensure that they are attuned to recognizing emerging fraud schemes and know how to respond—or not respond.
Be cautious about handling and mailing checks. Rather than choosing to drop checks in an exterior mailbox that may not be as secure as it appears, hand them to a clerk at the post office. Also, refrain from leaving mail on an open counter in the office for a mail carrier to pick up.
Shift to electronic payment methods like ACH and credit cards. Integrated payment platforms can help drive efficiency for your business, enable you to earn rebates and better control your cash resources.
Reach out to your insurance agent or broker. Double check that your current insurance policy includes adequate coverage for check fraud and cybersecurity breaches.
Take advantage of the available tools and resources to reduce your risk. Enterprise Bank & Trust offers several valuable tools to minimize the potential of fraud loss or disruption of payments to your vendors, clients or employees.
Understand and support our role in protecting your business. Partner with your bankers to ensure all available tools are harnessed in order to prevent and mitigate the persistent, ever-changing threat from fraudsters.
We constantly balance the need to guard our clients’ accounts with our commitment to deliver convenience and efficiency to them. When our fraud analytics systems flag a potentially fraudulent transaction and we reach out to confirm its validity, it’s because we’re committed to the ongoing financial integrity of your business.
Every business, regardless of size or industry, is susceptible to fraud. While there’s no foolproof way to ensure 100% protection against fraud, your business can minimize its risks by staying alert to trends, continually educating your people and taking proactive measures to defend against skilled fraudsters.
