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AG Nessel Shares Tips for Businesses on How to Avoid Falling Victim to Identity Theft

LANSING – Michigan Attorney General Dana Nessel joined the West Coast Chamber of Commerce this morning to share warnings and tips about Business Identity Theft based upon complaints received by the Department’s Consumer Protection Team. 

“Identity theft affects businesses as well as individuals," said Nessel. "Small and large businesses alike face attempts to defraud them that often go unrecognized. We will be bringing our Business Identity Theft presentation around the state to arm Michigan residents with both the knowledge they need to recognize common scams and access the available resources should they fall victim to them.”  

According to the Association of Certified Fraud Examiners, the deceptive activity of business-to-business fraud costs US companies an estimated $7 billion every year. In business identity theft -- or corporate or commercial identity theft -- a bad actor uses a business’ name to steal its assets, credit, and/or reputation. It can take the form of criminals impersonating a business or it can happen when thieves file fraudulent paperwork to take over a company. 

There are six types of identity theft that Attorney General Nessel encourages business owners to be aware of:

Financial Fraud – scammers obtain new lines of credit, loans or credit cards; create fraudulent Uniform Commercial Code filings.

“Bust-Out” Fraud – a specific type of financial fraud that occurs when the bad actors create a seemingly legitimate company by registering with the Michigan Licensing and Regulatory Affairs Agency (LARA), renting office space, and even setting up a website.

Tax Fraud – filing fraudulent tax returns and obtaining refunds from federal and state governments.

Website Defacement – manipulating a business’ identity on the web.

Trademark Ransom – fraudsters register an already-in-use business name as an official trademark and demand a ransom from the legitimate business for the release of the trademarked business name.

Material Misrepresentation – criminals create a business with a name similar to another established business.

Attorney General Nessel encourages businesses to take the following steps to help protect their business:

How to Protect Your Business from Identity Theft

  • Set up fraud alerts for your business by sending a signed letter on your business’ letterhead to credit reporting agencies like Equifax, Experian, and Transunion, signed by the owner to initiate fraud alerts;
  • Just as consumers should protect their login information, businesses should train their employees to protect their company logins and identifying information;
  • Don’t use personal devices for business purposes; use separate phones;
  • Regularly scan for vulnerabilities and/or unauthorized access;
  • Know how hackers use employees and their information to breadcrumb into companies and government agency computer systems, which allows them access to all kinds of company and personal data;
  • Use website defacement monitoring services;
  • Install anti-virus/anti-malware software with automatic updates on all company devices; and
  • Encourage your legislators to pass legislation to make it harder to steal a business’ identity.

Protect Your Business from Cybersquatting

  • Trademark your brand regardless of company size; 
  • Be proactive about conducting regular web and social media searches for company names, unique products, identifiers; 
  • Purchase similar domain names and redirect to the main site;
  • Don’t give outsiders administrative access to your site unless absolutely necessary;
  • Ask for recommendations from IT and cyber security companies; and
  • Refer to Michigan State University’s online Brand Protection Professional for resources designed to help identify and manage acquisition, protection, licensing, and enforcement of trademarks and other brand assets.

How to Protect your Business from Business Tax Fraud  

  • Check your business’ credit file often using Form IRS 10439-B; 
  • Encrypt sensitive files and backup using secure networks; 
  • Use multifactor authentications; and 
  • Invest in credit monitoring services.

Some of these solutions may cost money. However, this money up front can save your business profits later.

To file a complaint with the Attorney General, or get additional information, contact:

Consumer Protection Team
P.O. Box 30213
Lansing, MI 48909
Fax: 517-241-3771
Toll free: 877-765-8388
Online complaint form

Michigan Identity Theft Support (MITS) is an extension of the Department’s Consumer Protection Team. MITS staff is dedicated to helping victims navigate the challenges of identity theft. The signs of identity theft, the various types of identity theft, and the steps to combat it are among the resources available to Michiganders on the MITS website.

Your connection to consumer protection is just a click or phone call away. The Department provides a library of resources for consumers to review anytime on a variety of topics.


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