At Hokodo, we understand that extending or benefiting from credit terms can expose your business to certain risks. Whether you’re a merchant using Hokodo’s solution to offer payment terms or a buyer enjoying flexible credit, it’s crucial to stay vigilant. Here’s how to safeguard your business against common and emerging fraud threats.
For merchants: mitigating fraud risks when offering trade credit
When providing buyers with credit terms, it’s essential to be aware of potential fraud. Below are the key risks you should watch out for, along with tips on how Hokodo can help you stay protected.
🛡️ 1. Corporate identity fraud
Fraudsters may impersonate legitimate businesses by exploiting publicly available information or taking over dormant companies. They use this tactic to open accounts and place fraudulent orders under the guise of a trusted buyer.
How Hokodo helps: Our verification processes identify anomalies in buyer information and flag suspicious activities. However, it’s still important for merchants to be cautious, particularly with new buyers who request unusually large credit limits or urgent orders.
How to protect yourself:
- Cross-check buyer details, especially if a business has recently updated its contact information.
- Be cautious of new buyers with limited trading history and verify their registration details independently.
- Report any suspicious activity to Hokodo through our Contact Us page.
📧 2. Business email compromise
Fraudsters may hack into or spoof a merchant’s or buyer’s email account to send fake invoices or payment instructions, redirecting funds to their own accounts.
Why it’s relevant: These types of email scams are increasingly sophisticated and often mimic legitimate communication patterns. Fraudsters may impersonate Hokodo or your business partners to deceive you into making unauthorised transactions or changing payment details.
How to protect yourself:
- Be cautious of unexpected requests to change payment instructions. Always confirm such changes via a phone call to a trusted contact number before proceeding.
- Use multi-factor authentication (MFA) for email accounts to prevent unauthorised access.
- Train your team to recognise phishing attempts and suspicious emails.
📦 3. False disputes
Buyers may falsely claim that goods were not delivered, were damaged or did not match the description, even when this is not the case. These disputes can result in revenue loss and strained business relationships.
How to protect yourself:
- Always document your deliveries with proof, such as signed receipts or photos upon arrival.
- Use tracking systems to confirm that goods were delivered to the correct location and received in good condition.
- Maintain clear communication records with buyers to resolve disputes swiftly.
🔐 4. Account takeover fraud
Fraudsters could gain access to your Hokodo account, change details and place unauthorised orders. This can disrupt your business and result in financial losses.
How to prevent it:
- Keep your credentials secure and limit access to trusted employees only.
- Establish clear internal protocols for managing account changes, with designated approvers for critical updates.
- Always confirm modifications through official Hokodo communication channels.
If you suspect any fraudulent activity, reach out to us immediately via our Contact Us page.
For buyers: safeguarding your business when using Hokodo
As a buyer leveraging payment terms via Hokodo, there are some emerging threats you should be aware of to protect your business.
🚫 1. Phishing scams
Fraudsters may impersonate merchants or Hokodo to gain access to your sensitive information. Be cautious of unsolicited communications asking for payment details.
How to protect yourself:
- Verify the authenticity of any emails before sharing payment information.
- Avoid clicking on links or downloading attachments from unknown sources.
- Use secure payment methods and monitor transactions for any irregularities.
📋 2. Supply chain and vendor fraud
Fraudsters may attempt to exploit vulnerabilities in your supply chain to intercept transactions, alter payment instructions or manipulate orders.
How to protect yourself:
- Be cautious of any unexpected requests to change payment methods or shipping details, especially from merchants or third parties you work with.
- Use Hokodo’s secure communication and transaction platforms to verify the legitimacy of orders and payments.
- Regularly review your account activity and report any anomalies to Hokodo.
By staying aware of these risks and taking proactive measures, you can continue to benefit from Hokodo’s digital trade credit solutions with confidence. For further guidance on fraud prevention, check out resources like Get Safe Online (UK) and Signal Spam (FR).
If you have any concerns about potential fraud, please don’t hesitate to contact us via our Contact Us page.
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