Business Fraud: Protecting Yourself
GRAND JUNCTION, Colo. - New statewide security measures are making it easier for businesses to protect themselves from fraud. But officials say the Western Slope may not be as aware of these changes, leaving entrepreneurs more vulnerable than they think. Officials from Secretary of State Scott Gessler's office says an epidemic arose a few years ago when fraudsters around the country were targeting Colorado businesses because of the way the business registration website was set up. Prior to 2011, almost anyone could access the website, list themselves as a registered agent for a business and fraudulently open lines of credit under the businesses name. "It's really important that you have access to the credit that you need to carry you through some of the low spots and the high spots of your business. So this could literally put a business out of business," explained Diane Schwenke with the Grand Junction Chamber of Commerce. To combat this problem, several security measures were put in place. "You can sign up for an email notification. So if there are any changes to your business record, our office will alert you saying that your name has changed, your registered agent has changed. You'll get those notices immediately. In addition, you can opt into a password protection system so only you can make changes to your business record," explained Rich Coolidge with Secretary Gessler's office. Officials say at the height of the problem in the fall of 2010, they were receiving 50 to 60 complaints a month. As of the summer of 2013, they only get two to three reports per month. The new measures have helped Colorado become a pioneer for business security protection, Coolidge says. "The secretary sits on the National Association of Secretaries of State Business ID Theft Task Force. He gets to spearhead and teach other secretaries of state around the country about business identity theft," he explained. But local officials say the Western Slope might not be aware of these changes. "We think about individual identity theft. But businesses really do need to be cognizant of the fact that their business identity can also be stolen," explained Schwenke. "They have to open new business accounts. They have to order new checks," added Sandra Legg, a certified fraud examiner. Legg is also the head of the fraud department at Alpine Bank. "Identity theft for anyone is hard to overcome. And so if it does happen, it can take years to clear up," Legg said. Legg also says one vulnerability businesses don't think of is with employees. They can victimize a small business by using information they've been exposed to just as easily as professional scammers can.