Most business owners have enough on their plates, and they certainly do not need to look for additional problems. Unfortunately, scam artists and fraudsters tend to target small business owners because they know that, most times, they’re more susceptible to being taken advantage of.
If you own or run a business, it’s essential to be aware of some of the most common forms of business scams. When you know what to be on the lookout for, you’re better equipped to keep your company protected from such vulnerabilities.
1. Cyber Fraud
Cyber fraud is one of the most concerning types of fraud in the modern business world, given that it can take many forms, and it’s particularly difficult to stay ahead of it when you — or your employees — aren’t particularly tech-savvy.
Some of the most common forms of cyber fraud that pose serious issues for business owners in the digital age include the following:
- Phishing scams
- Ransomware
- Wire fraud
- Hacking
Cyber fraud can do serious damage. Common outcomes include exposing sensitive client data, releasing confidential materials, or losing significant amounts of money, and though well-trained employees and safe digital practices can help you avoid falling victim, calling a business lawyer immediately can help mitigate the damage should your company end up blindsided, regardless.
2. Financial Statement Fraud
Financial statement fraud refers to the falsification of financial statements for personal gain. Every business owner should be aware that fraudulent financial statements are a serious issue that can hurt their companies in more ways than one.
One common form of financial statement fraud is when a supplier, distributor, or other business partner inflates costs, lists dishonest expenses, or otherwise manipulates statements to receive higher payments than they are owed. It’s also possible for your employees to manipulate statements, pocketing the difference for personal gain.
Keeping a close eye on financial reports and statements and watching for unexpected or over-budget costs can help you catch these forms of financial fraud, and if you do discover it’s occurring, you should immediately contact a lawyer to discuss how to confront the responsible person and recover the lost money.
3. Tax Fraud
Tax fraud is a common issue business owners run into, especially those of small businesses, as they may have less knowledge about their legal responsibilities when it comes to paying taxes, reporting employee earnings, and other tax obligations.
The IRS doesn’t take tax fraud lightly: When you fail to report and pay the appropriate taxes, you can easily find yourself facing felony charges, prison time, and significant fines.
You can protect your company from accidentally committing tax fraud by keeping careful records, reporting all earnings and employees, and hiring an experienced accountant. If you discover your company might be at risk of having committed tax fraud, you should contact a business lawyer as soon as possible. Coming forward to right the damage goes a long way toward avoiding unwanted legal and financial consequences.
Concerned about fraud? Call a Long Island Business Lawyer
If you are worried that your business is susceptible to one of these common forms of business fraud, or if you’ve already fallen victim to a cyber scam and are worried about tax fraud charges, the experienced business attorneys at Kohan Law Group are here to help. We’ll review your current situation, helping identify vulnerabilities and taking action when your business has been targeted.
Call Kohan Law Group today to learn more about how our Nassau County business lawyers can help with your business’s legal needs.
The information provided in this blog post is for educational purposes only and is not intended to constitute legal advice. It is essential to consult with a qualified attorney regarding your specific situation and circumstances.