What Do Thieves Look For When Targeting a Business For Identity Theft?

Identity thieves are savvy. They don’t just randomly pick businesses to hijack. Their targets are chosen carefully, with specific goals in mind.

Below are some of the main factors identity thieves consider when looking for a business to target.

Business name & industry

As you know by now, identity thieves assume the identity of a business in order to exploit its assets and reputation. Usually, their scam involves using a targeted business to obtain money or products from a third party. They might try to get a business loan, for example, or purchase several cell phones on credit, with no intention of ever paying either back.

How the criminal intends to acquire illicit funds or purchases determines what kind of business he or she might want to hijack. For example, say a criminal wanted to buy, on credit, a commercial printer and then re-sell it on the black market. The identity thief, in this case, might want to hijack a company in the printing business or one that actually has the word “printing” in its name.

That way, when the criminal goes to purchase the commercial printer, it won’t look out of place. Imagine if the thief hijacked a coffee shop’s identity and then tried to buy such a device. That could raise red flags – and that’s the last thing an identity thief wants to do. Their goal is always to avoid suspicion.

Credit rating

Since a huge part of any identity thief’s scam is exploiting a company’s (or an individual’s) credit, thieves generally are going to target businesses with the best access to it. That means identity thieves often will check the credit rating of an intended target, to confirm that it has access to enough money to obtain whatever the criminal desires.

In practical terms, that means identity thieves are more likely to target established businesses with good track records, rather than startups. Startups, particularly startups founded in the last year or two, are going to have far more difficulty securing credit than a company that has been around for a decade.

Identity thieves’ obsession with credit, however, does have its drawbacks. Sometimes, after the fact, you can figure out who has looked up a business’s credit rating. This can allow business owners who have been the victims of identity theft to backtrack and figure out the identity of their hijacker.

Trademarks

Some identity thieves engage in trademark ransom schemes, in which they trademark an existing company’s name and then sue the existing company, after the fact, for infringing on their trademark.

These sorts of scams only work, however, when a company hasn’t been diligent in filing for trademarks of its name.

Thus, another thing thieves look for when choosing a business to target is whether the business owner has filed for all of the necessary trademark protections, particularly on the business’s name.

If you’ve been lax in keeping up on your trademark protections, that’s an open invitation for identity thieves to target you.

Easy access to information

The more information an identity thief can get access to, the better he or she will be at pulling a scam. Therefore, identity thieves target those businesses for which they can acquire the most information.

If your enterprise is structured as a business trust, identity thieves will have no interest in hijacking it, because business trusts don’t publish their officer names or addresses on state government business portals, like the Nevada Secretary of State’s website SilverFlume. A business trust holds no appeal as a target because the available information is scant.

But keep in mind, there are tradeoffs if you choose a trust, which don’t have the same tax and structural benefits as an LLC, C-Corp or S-Corp. 

Conversely, a business that publishes the names of its board of directors on its own website is much more appealing simply because the information is all in one place, easy to grab.

But don’t assume identity thieves will limit their backgrounding of your business just to the Internet. Identity thieves are notorious dumpster divers. So, be watchful of the kind of information that you throw away in your trash. If identity thieves discover that they can get a boatload of information about your business simply by sifting through your garbage every couple of weeks, your business will become a more desirable target.

Distracted owners

Identity thieves rely on their targeted businesses not noticing when they’ve been hijacked. The longer they can keep their deception concealed from a targeted business owner, the longer they have to make mischief.

So, a critical thing identity thieves look for are business owners who are so busy or distracted that they might not notice when clues start trickling in that their business has been compromised.

One sort of business that fits this category perfectly is dissolved, delinquent or inactive businesses. When a business is labelled that by a business registering authority, such as the Nevada Secretary of State, it’s a good bet the business owner isn’t paying too close attention to the business. Those labels are an open invitation to thieves. They practically scream, This business isn’t being watched carefully.

But even active businesses can provide an inviting target to identity thieves. A busy business owner not carefully watching his or her business is very alluring to an identity thief. But Company Alarm can help by monitoring your business for you.  Our software was designed specifically with Andy's experience in mind.  

If you advertise your business as being protected by Company Alarm, smart identity thieves will steer clear of you.

Oh, and one other note: I’ve found there can -- sometimes -- be an element of randomness to business identity theft. Some criminals know how to steal Honda Civics, so they steal every random Honda Civic they come across. 

The same can be true of identity thieves.  If they know how to rip off printing companies,  that’s what they do -- at every chance they get. 

I mention that simply to warn you: You can do everything right as a business and still end up a victim. That’s why it’s essential to be on guard against business identity theft at all times, and why Company Alarm can help.