Remote Workforce Threatens Small Business Fraud Defenses

Businesses contemplating the transition to a remote workforce should prepare for possible increased fraud-related headaches.

As reported recently by the Wall Street Journal, U.S. workers have voiced a clear preference for remote employment, as commercial office vacancy rates remain as much as 60% higher than they were pre-pandemic. Drivers for employees’ preferences vary and may include increased schedule flexibility and savings in commuting costs. However, there are also clear boons for employers, especially for small businesses renting office space.

Despite the potential benefits for both workers and business owners, the shift to remote-forward workplaces comes with certain challenges. Security concerns are high on that list, as fraud-fighting strategies may differ between in-office and remote work arrangements. New elements to consider may include employees working off unsecured Wi-Fi networks, software glitches across multiple networks and poor cybersecurity hygiene. Any of those factors could leave businesses open to attacks by hackers or other bad actors.

Successful in-office security strategies may not often translate well to remote-only work environments, where employee behavior is less easily monitored. This may present a particular stumbling block for small businesses, which may have fewer funds set aside for security investments.

However, hackers aren’t in the habit of overlooking businesses to target due to organizations’ budget constraints.

As illustrated in the latest PYMNTS collaboration with American Express, “How SMBs Can Fight the Fraud Threats of Remote Work,” fraud and related concerns can significantly impact companies’ expansion abilities.

Businesses adopting proactive and automated solutions to digital fraud suffer the least impact on new customer acceptance, friction in the consumer experience and limits to their international expansion. Most at risk are organizations utilizing reactive and manual systems, where 54% of these firms missed out on new customer opportunities due to their reliance on outdated solutions.

For small businesses considering the jump to a remote-first workplace, finding trusted third-party partners or platforms catering to their needs may be the most seamless strategy for fraud-fighting. In the U.K., cybersecurity firm Prove Identity is partnering with financial organizations and mobile carriers using its Trust Score to bolster protections against authorized push payment fraud and other scams. Using cryptographic authentication, Prove’s solutions include aiding clients in digital verifications and analyzing telecommunications signals and behavior patterns to spot possible fraudulent transactions.

Stateside, Galileo Financial Technologies expanded its Payment Risk Platform solutions by partnering with DataVisor late last year. Galileo’s enhanced platform focuses on payment infrastructure, combining its existing fraud analytics capabilities with DataVisor’s AI tech. The platform’s features include debit and credit transaction support, as well as protecting clients’ protection against payment fraud.

Small businesses have many factors to consider when contemplating the move to a remote-only workforce. Tailoring security measures to meet the needs of this transition may be wise to keep at the top of the list.