As a consumer, you’ve no doubt heard the following message loud and clear:
To stop identity theft, check your credit report.
But, as a business leader, have you heard the same? It’s less likely. That’s because many small business owners don’t even realize business credit reports exist, let alone that they can be powerful tools for spotting the work of identity thieves.
Just as reviewing a personal credit report helps individuals spot suspicious credit inquiries, a business credit report alerts teams to illegitimate checks on the company’s creditworthiness. This can signal identity takeovers of key personnel or attempts to fraudulently open accounts in the company’s name.
Each of the three major consumer credit bureaus invites consumers to check their credit reports annually for free. This is not the case for business credit bureaus; you will need to pay for full reports.
However, the process is not complex and definitely worth the investment should you see something off on the reports. Small businesses lose an average of 5% of their annual revenue to fraud, including business identity theft. What’s more, business fraud and identity theft can damage your company’s credit score, limiting your access to future funding. It may also erode vendor or customer trust, and potentially even increase insurance premiums.
Because each of the business credit reports maintains its own set of reports, it’s a good idea for businesses to check all three. Scatter the checks throughout the year to maximize your scans for trouble and spread out the expense.
The three business credit bureaus are:
So, what are you looking for once you get the report? Common signs of fraudulent activity include:
Monitoring a business credit report is a simple, affordable and frontline defense against costly identity theft. With fraud losses averaging thousands of dollars per incident, staying vigilant can go a long way in the mitigation of key financial and reputational risks for your company.
If Bank Iowa’s credit and/or fraud teams can help you along your business credit-check journey, get in touch with us today.