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Are fraudsters after your business money?

Small businesses are often seen by criminals as an easy target for fraud. Find out what you can do to prevent it happening in your business.

Imagine on a typical busy working day, that your long standing supplier calls you up and tells you that their banking details have changed. You’re told you need to amend invoice details to keep your regular contract in place with them. Without thinking twice, you change the details there and then.

But in the space of a few minutes you've not made a ten thousand pound payment to one of your business partners but to a sophisticated criminal who has siphoned off your money and sent it out of the country. Money you will not be able to recover.

Invoice fraud

This scam – which we call invoice fraud – has been one that has been rising steeply over the last few months and small businesses have been hit particularly hard by. Criminals are exploiting the fact that staff working in small companies tend to be very busy, often juggling dozens of tasks every day.

A single, simple request to change payment details is likely to appear routine and often will be signed off without a second thought. Unfortunately many staff are falling for the scam, resulting in significant losses for their organisations.

There are variations of the scam – sometimes the fraudsters won’t even call – they’ll simply send you a letter or email with the name of your supplier and ask you to change your payment details. In all cases the criminals have done their homework and have researched your existing suppliers to make their deception as convincing as possible.

Preventing fraud

So how can you stop yourself becoming a victim? Firstly, be on alert if you get a request to update payment details that comes ‘out of the blue’. If you have any doubt whatsoever about the authenticity of the request, call up a contact you know at your supplier and check that it’s genuine.

Alternatively, ring the caller’s company switchboard and ask to be put through to the person who asked for the payment details to be changed. This simple check could save your organisation a huge amount of trouble and inconvenience.

Phone scams

You should also be aware of other common phone scams – which can be just as costly – where you’re called and tricked into revealing financial or banking details. Fraudsters will use a variety of methods to talk you out of your money, but remember, there is no legitimate reason for your bank or the police to ask for your PIN number, your banking codes, or to request that you transfer money into other bank accounts.

If something seems suspicious, hang up the phone and leave it a few minutes for the line to go dead and then call the organisation back on a number you trust. Remember though, it takes two people to end a call, so make sure you don’t pick up the phone and find yourself connected to the same fraudsters as before.

About the author

Financial Fraud Action UK tackles fraud on behalf of the banking industry. They’ve got lots of practical advice on scams like these and others. Spend a minute now to learn how to beat the fraudsters.

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