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The impact of small business fraud
The Federation of Small Businesses has release a report into the effect of fraud and online crime on SMEs. Titled: "Inhibiting Enterprise: Fraud and online crime against small businesses” the survey results show how widespread small business fraud is in the UK and the impact e-crime in particular can have on smaller businesses.
54% of businesses affected
According to the findings over half (54%) of businesses have fallen victim to fraud or online crime in the past year. Phishing emails were the most popular complaint, however Card Not Present Fraud (CNP) features heavily in the report, due to the cost impact it has on smaller companies.
29% victims of CNP Fraud
29% of businesses surveyed had fallen victim to CNP fraud, with 22% receiving a chargeback. For smaller online retailers, a CNP chargeback can be costly, both in terms of revenue and products lost, and the administration time needed to deal with the chargeback process.
Importance of fraud prevention
The report also shows that business organizations understand that the best form of fraud protection is prevention, however only 6% of firms access guidance or training on fraud prevention via websites or fraud forums. 192business.com run an online forum, which is available free of charge to online retailers, and can help SME’s share information and best practice to prevent business fraud. For more information, please email the forum administration team here.
The report sets out a number of recommendations and also praises the formation of PCeU, and supports the idea of a central reporting system for business fraud.
The full report is available here: http://www.fsb.org.uk/frontpage/assets/inhibitingenterprise.pdf
20th February 2009
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