Criminal Liability Scams

If you've ever been scammed, you'll undoubtedly have felt that empty and futile feeling of embarrassment and loss. You may have lost copious amounts of money, possessions or even just your pride. Regardless of whether you've lost physical possessions, or just taken an emotional battering as a result, it's certainly not a good feeling to be scammed. Scams are big in the media at the moment, with a growing prevalence of 'ATM scams', where teller machines are being bugged to record innocent customers credit card details and pin-numbers and keystrokes are being recorded and used to commit fraud and theft, hence creating liability claims that need to be met by the banks. Corporate scams are not all that different in the sense that they are well thought out, and generally well executed. The biggest difference between individual scams and corporate scams however, is generally the amount of people affected. Whilst Jessica might be upset if her credit card details are swiped and use to purchase goods from china, imagine the distress of 200,000 shareholders who take the punch if Coles Group was to get scammed.

Some Examples of Criminal Liability Scams

Quite often, however, corporate scams come from within, with employees over-stepping the mark and looking to profit from the operations of the corporation they represent. Some popular examples include employees spending company money for private gain - for example if John was to spend $200,000 of his organisations budget on paying off the mortgage on his holiday house, he is committing a scam in which he is criminally liable.
Other scams include ordering large amounts of unnecessary stock in the name of the business where they are intended for business use. For example, purchasing computers in the name of the business but taking two of them home for the family is very much condemned under criminal law. Fraudsters regularly set up merchant accounts in an organisations name, following this by receiving and accepting goods on an organisations behalf to which they do not belong, leaving the organisation without their products and a big headache. Scammers are also known for rummaging through rubbish bins in an attempt to get employee names, bank account details, addresses, and other sensitive data. This data is then sold off to other companies and can be quite profitable. Customers are the first to go to the courts and process liability claims. The world of the internet has also made scams more common, as computers and IT provide criminals with more options than ever before in the field of scamming. Regularly websites are hijacked, and redirected to bogus servers in an attempt to obtain customer information, such as credit card numbers. Scammers are also known to register website domains similar to the original, but with subtle variations (for example www.utube.com as opposed to www.youtube.com) could be used to steal website traffic and profit from advertising 'hits'.

So Who Can Be Trusted?

Sometimes it feels like you can trust basically nobody, and this is no different in business. Some of the best scams have been committed by innocent-looking cleaners and tradesmen who have access to the buildings after-hours, and are able to rummage through offices, looking at sensitive data and can then use this information against the corporation. Passes, passwords, ID tags, and other private information are usually at the top of the 'wanted' list.
It's essential that corporations get themselves basic criminal liability insurance protection, such as commercial general liability insurance, which can help protect them in the instance that something goes wrong.

The Benefits of Commercial General Liability Insurance

If you're a corporation, the most integral thing to do is to obtain basic criminal liability insurance - at least at the most basic level. Commercial general liability insurance is available for purchase from a number of providers throughout the world, and its scope and effectiveness differs from country to country. Corporations need commercial general liability insurance because CGL protects the business in the event that they are sued or taken to court. It's used to cover claims against an organisation for injury or property damage. This 'injury' or 'property damage' is no different in the world of scams, as it can also protect 'intellectual property' that is stolen - for example web domains, credit card details, etc. The last thing an organisation wants is to provide a 'please explain' to their shareholders when their customers private information is leaked to parties with malicious intent. At least with CGL insurance the organisation is financially not liable for the problems, due to their wise insurance policy decisions. Without such commercial general liability insurance, a business is most vulnerable to lawsuits that can potentially have a devastating impact on its existence. It is for this reason that commercial general liability insurance is the most important - apart from perhaps contents insurance - insurance product sought after by owners and organisational facilitators.

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