The Cost of Complacency; Doing Nothing Is Not an Option for Small Businesses When Dealing with Crime, Says Fay Goodman
Byline: Fay Goodman
Running a small business is not easy at the best of times but throw 'crime' into the equation and we could find ourselves in the balance of survival or imminent closure. The ICAEW has been very proactive in trying to raise awareness of its' members and, in turn, their clientele to implement good practice towards crime prevention in all areas of business ranging from fraud to employee theft.
Fraud, for example, comes in many guises from using someone's credit card details over the Internet or in a shop to purchase goods with stolen cards.
Fraud is a crime but what is Crime? It takes many forms - it could be physical damage to property, theft of goods, vandalism. But these physical afflictions are now also increasingly augmented by abstract and intellectual crime. By that I mean identity theft, credit card fraud or the growth of hackers and fraudsters who break into our cyberspace and rape our IT systems.
The effects upon small businesses are far reaching with an average loss of pounds 8,000 per case. For a small business with a turnover of pounds 20,000-pounds 30,000 and bread line margins it could spell bankruptcy. Even worse they may suffer permanent damage to their credit status affecting their ability to obtain finance or insurance and consequently send their business to the wall. Government statistics show that identity theft now costs the UK over pounds 1.3 billion a year and is growing at an alarming rate.
While it is accepted that too many people take insufficient care over credit card transactions and ignore the dangers of paying for goods the Internet it is, nevertheless, now one of the fastest growing and convenient ways to shop. Any form of money transaction whether over the counter, by cheque or credit card, over the 'phone or internet will attract the fraudster to try and hijack the details of honest traders. …