Company Identity Theft in Germany

Those engaging in fraudulent activities are becoming more adept at stealing identities. Personal identity theft is now a regular occurrence, whereby individuals can have their personal information, such as their name, social security number, or credit card information, used for fraud. Corporate identity theft is also growing, and people use several methods to accomplish it.

Firstly, phishing emails and messages are amongst the most standard methods implemented. The parties present aim to deceive employees, managers and others involved in the company into revealing sensitive company information with such messages. This sensitive information can include login credentials, account numbers and other financial information. Such fraudulent emails can appear to come from a legitimate source, particularly banks or government agencies. Sending emails claiming to come from internal company sources is a growing tactic in this area.

Those involved with the fraud can send phishing emails to employees generally or targeted at specific employees or departments. They may seek certain information, and such emails can be sophisticated and challenging to detect. Companies need to be vigilant to protect themselves from phishing attacks, which can involve training employees to recognise such scams.

Hacking attacks can also bring about corporate identity theft. Hackers seek to exploit vulnerabilities in software and use stolen login credentials to gain access to the company’s systems. Once they can access them, they can install malware, steal sensitive data and overhaul the company’s systems or hold them to ransom. Hacking can also lead to hackers gaining access to the company’s intellectual property.

Such hacking can lead to significant financial losses, and if the information reaches the public, it can have severe consequences, including damage to reputation and a lack of trust. Therefore, companies must act proactively to protect their systems and networks. Should a company discover that they have been the victim of such corporate identity theft, it must act swiftly and contact legal support. Our team will support them in navigating the complex legal and regulatory issues that may arise in these situations.

Another standard method of corporate identity theft concerns insiders within the companies. Such insiders can include current or former employees or contractors with sensitive information or systems access. Some individuals may abuse such access to steal sensitive data, financial records or intellectual property for personal gain.

Detecting these threats can be particularly difficult for companies. However, should a company feel at risk of such an attack, please consult our professionals. They will advise you regarding how to implement internal systems that may be helpful. For example, our lawyers advise companies on matters relating to efficient and effective whistleblowing and internal grievance mechanisms. Companies can then implement such systems to allow employees to report and take action in such cases confidently.

At Schlun & Elseven Rechtsanwälte, our lawyers advise companies about these methods and others in corporate identity theft and support them with implementing appropriate measures to prevent them. Such actions include educating employees about phishing and social engineering risks, implementing strong access controls and authentication procedures, and regularly monitoring their networks for suspicious activity.

Companies need to be vigilant in corporate identity theft and ensure that they are prepared for such an eventuality. Detecting fraud or information theft is crucial in resolving disputes and mitigating potential difficulties. Companies have a variety of actions they can take to detect identity theft.

Firstly, they should regularly monitor their financial accounts, such as bank accounts, financial statements and credit reports. Regular monitoring will allow them to uncover suspicious activity and transactions promptly and thus act decisively before the situation deteriorates. Such monitoring should include audits of the company’s internal systems and networks.

Companies should also conduct security assessments on their internal systems and networks. Such tests should include vulnerability scans or penetration testing to identify any vulnerabilities or weaknesses in their procedures. Similarly, they must monitor for data breaches and stay aware of this area’s latest threats and trends. By acting proactively, companies will know what to look for regarding violations and be mindful of how to respond.

Should the company discover corporate identity theft has occurred, it must act appropriately. Consulting with our legal team will ensure they will perform in the correct order. Steps they can take include notifying law enforcement and affected third parties (including customers and employees), conducting an internal investigation and taking corrective action.

How the company should react will depend on their situation, and therefore, it should be seen as necessary first to discuss the matter with our team. Our lawyers will guide you through the best course of action and advise you regarding your company’s legal rights and responsibilities in this situation.

Companies in Germany need to act vigilantly to prevent corporate identity fraud. The actions listed here need to be conducted regularly, including employee training.

Firstly, companies need to conduct checks within their companies, particularly in matters concerning access to and security of sensitive data. Customer and corporate data are now significant currencies for fraudsters, and companies must protect themselves. Companies should shield such data using password-protected systems, encryption, and firewalls to prevent unauthorised access. However, as stated above, insider knowledge is an effective means of corporate identity theft; therefore, companies must know who has access to sensitive data. They need to prepared to limit access to sensitive data to only those employees who require it to perform their duties.

Companies must implement security protocols such as multi-factor authentication and regular password changes to help prevent unauthorised access to company systems. There should also be systems in place to monitor for suspicious activity that will help uncover signs of identity theft, such as unusual financial transactions or requests for data.

Employee training is crucial. Such training will highlight to employees how to respond to hacking or phishing attacks. Regular training will ensure the company’s employees are aware of best practices relating to data protection and cyber-security. In turn, this will ensure that they avoid accidentally or intentionally disclosing sensitive data. Other aspects involving employees include developing company-wide policies concerning data protection and guidelines to prevent identity theft and providing resources with the most current information on identity theft matters.

Developing whistleblower and internal reporting systems are crucial. Companies can encourage their employees to report suspicious behaviour by having secure and suitable mechanisms within the company structure. Such systems can also be decisive in ensuring that employees don’t go outside the company with their grievances and suspicions.

Companies may also need to ensure that their physical premises are secure. By having security cameras and alarms in place, the company can ensure that there is no unauthorised physical access to what should be secure locations within the company. However, implementing security cameras and alarms also comes with risks and must be placed legally.

There are significant penalties involved for corporate identity theft in Germany. Their severity is based on the nature of the offence and whether the victim pursues a civil or criminal case. In civil lawsuits, companies may seek damages or compensation for any losses or damages suffered due to identity theft. These damages may include financial losses (such as the costs of investigating and resolving the theft, as well as any direct financial losses, such as stolen funds or unpaid debts), damage to the company’s reputation through negative media coverage or loss of business, or other harm caused by the theft of their identity.

Criminal cases in Germany can involve more severe penalties, including fines and imprisonment. Under German law, identity theft is generally classified as fraud, which is a criminal offence. The severity of the punishment depends on the case’s specific circumstances, including the value of the assets involved, the perpetrator’s intent and whether the action was as part of an organised criminal gang.

Our lawyers will advise you regarding the potential sanctions involved in such cases. Our clients can rely on our experienced professionals to advise them regarding actions they can take in such situations.

Proving company identity theft can be a difficult task, and to do so companies need to take considerable actions regarding evidence. Collecting evidence in the form of relevant documents, including financial statements, bank records, correspondence and invoices is a starting point. Such documents should demonstrate that the company’s identity was used without the proper authorisation. Our legal team will advise your business about how such documents can be used in the court setting and what are the critical indicators for demonstrating that fraud occurred.

Our lawyers will also advise your company regarding witness and expert testimony. Such statements can be crucial for demonstrating that the company acted responsibly in relation to data protection and security measures if challenged. They can also support statements made with regard to the technical aspects of the theft.

Internet data such as IP addresses, email addresses, or social media posts that show evidence of the identity theft or point to the perpetrator’s identity as can surveillance footage or other physical evidence of the theft.

Our lawyers advise clients on all matters relating to the type of evidence required to prove identity theft. The evidence can vary depending on the specific circumstances of each case.