The Critical Intersection of Cybersecurity and Compliance

It isn't often that an email from the IRS sparks a positive thought, but today's email did just that. Everyone needs to worry about cybersecurity as cybercrimes can happen to anyone. As National Small Business Week continues, the IRS is putting a strong emphasis on the need for entrepreneurs to ramp up their data security measures. This call to action isn't just routine advice; it’s a critical directive aimed at protecting the lifeblood of America’s economy—small businesses.

This topic might seem a bit unusual for this blog, but it's relevant and connected. It's also something all legitimate businesses should support in the fight against. Cybercrime is not only a significant threat to data security but is usually linked to financial crimes. The Corporate Transparency Act (CTA) and the associated Beneficial Ownership Information Report (BOIR) aim to combat these very threats by increasing transparency and accountability in the corporate world.

The email from the IRS highlights several alarming trends, including the persistent threat of "phishing" and "spearphishing" scams. These nefarious tactics are not limited to large corporations; small businesses are equally, if not more, at risk. The IRS Commissioner, Danny Werfel, notes, “Each year, the IRS sees thousands of attempts trying to attack small business owners and other taxpayers... Cybercriminals are relentless, and anyone can be a target.”

What are the risks? Cybercriminals employ sophisticated methods to steal financial and personal information. They can manipulate human behavior and exploit vulnerabilities in computer systems to access sensitive data. If a small business does not safeguard its systems or train its staff properly, it becomes an easy target. The consequences can be severe—from drained bank accounts to stolen identities, not to mention the potential damage to the business's reputation and the trust of its customers.

Staying on guard against cybercrime is more crucial than ever. The IRS encourages the use of robust technology tools and services to protect financial and trade information and data related to customers, employees, and business partners. This involves basic cybersecurity measures like updating software, securing business files, requiring strong passwords, and using multi-factor authentication.

Fraudsters' tactics include manipulating natural human interactions via social media, emails, and texts. They go "phishing" by sending out thousands of messages designed to steal personal information or get victims to click on malicious links or attachments. Awareness and vigilance are key in preventing such breaches.

One specific example to be wary of is the Form W-2 theft scheme, where thieves pose as company executives and request sensitive employee data. This scam highlights the sophistication and evolving nature of cyber threats.

The IRS Dirty Dozen list is an annual compilation of the most common scams. This list is an excellent starting point for small business owners to familiarize themselves with the types of fraud they may face and take proactive steps to mitigate these risks.

What if you are a victim? The IRS outlines specific actions to take if your business falls prey to identity theft. This includes filing Form 14039-B, Business Identity Theft Affidavit, to report identity theft affecting tax records. Furthermore, maintaining current contact information with the IRS can help quickly resolve issues should they arise.

In conclusion, while the IRS email brings to light the daunting challenges of cyber threats, it also provides valuable guidance and resources. By taking cybersecurity seriously and staying informed about potential scams, small business owners can protect not just their businesses but also their customers and employees from the growing menace of cybercriminals. Always remember, better safe than sorry—implementing even the most basic cybersecurity measures can significantly bolster your defenses against these digital-age threats.

Addendum: Stay compliant by filing your Beneficial Ownership Information Report (BOIR) on time. After all, staying compliant with business regulations is tough when all your customers’ data just got compromised by a cybercriminal. The CTA and BOIR aim to combat financial crimes often linked to cyber threats, emphasizing the need for robust cybersecurity measures as a foundational aspect of compliance.

To learn more get answers using the BOIR and CTA trained AI Advisor or read the documentation available from FinCEN for a complete education on the CTA and BOIR. The BOIR is due now so go ahead and file for $29 or less with our service at FastFile.ai