ID Thieves Turn Sights on Smaller E-Businesses

For Online Shoppers, Security Seals No Guarantee That Hackers Aren't Watching
28 Sept 2006

Financial fraud experts indicate that data thieves are increasingly focusing their attention on small online businesses. Smaller companies have fewer customers but are often easier to hack into. This may be because the software they're using has security holes that they haven't patched, and small businesses are less likely to have staff dedicated to ensuring (or even understanding) security.

Looking for a security seal on the Web sites of smaller companies does not guarantee your safety from fraud. It's estimated that the scanning services behind those seals fail to identify up to 40 percent of the potential security risks on a Web site.

Understanding the extent of data theft from small online businesses is difficult because unlike corporations or government agencies, small companies are usually not required to publicly report security breaches. (A Gartner analyst. Avivah Litan, estimates that "only about 2 percent of data thefts from online merchants get reported." (Gartner is a major firm that researches information technology.)

Data theft from businesses of all sizes has driven the demand for tighter security requirements by credit card companies like Visa and MasterCard. Visa released a report indicating that 80 percent of credit card breaches were due to security issues by merchants.

Things to think about when reading this article

• If you don't know a business by reputation—a trusted brand or brick-and-mortar store, for example—do a little research first to find out if it deserves your trust.
  • Do your own background check. Look for an address (not a post office box!) or telephone number. Request a catalog by mail or call to talk to a company representative. Check into the Better Business Bureau.

  • Find out what others have to say about an online business on comparison sites such as Planet Feedback, Epinions, or BizRate. The sites build customer evaluations into their design with rankings indicated by smiley faces or stars.

• Pay with a credit card – not a debit card. Credit cards provide greater protections. Debit cards pull funds directly from your bank account, so even though many banks will cover your losses, it can take time for you to get your money back.  Read the article.