Invoice scams – have you protected your business?

Invoice scams

Businesses often work hard to protect themselves from traditional types of crime but an increasing number are falling victim to ever-more sophisticated scams. One growing type is invoice scams.

The 2,750 businesses surveyed declared more than 34,000 cases of invoice fraud in a year. 13% of those surveyed saw up to 20 cases during the period, while almost 1 in 5 (19%) declared 21 to 30 instances. Only 4.5% declared zero cases.

How invoice scams work

The way the scams work can make them hard to spot. Normally a criminal will pose as a legitimate supplier, claiming that their bank account details have changed. They can do this by intercepting emails or compromising a supplier’s email account.

Businesses who pay large sums to their suppliers are most at risk. Yet a seemingly innocent email from a ‘supplier’ could lead you to transferring tens of thousands of pounds to a criminal’s bank account. The average loss to business victims is a whopping £20,750.

So how do you prevent this from happening to you?

How to protect yourself

Finance UK has four tips for protecting yourself from invoice scams. To summarise, they are:

• Always phone a supplier on their official number, or speak to them in person, to confirm any bank account changes are genuine.
• Do not respond to emails asking you to update account details – the emails could be altered to look genuine or could be from a compromised account.
• If you make a payment to an account for the first time, transfer a small sum first. Then check with the company by phone to confirm it has reached their account.
• Contact your bank immediately if you believe you have been a victim of an invoice scam.

Above all, always make sure your staff are trained to be aware of scams like these. If you make it company policy never to update a supplier’s bank details without official phone confirmation, you’ll be making an important step to protect yourself.

Oh, and before I sign off, did you know that there’s also a thing called CEO Fraud these days? This happens when criminals use email to impersonate a CEO, sending a message to the finance team asking for a payment to be made urgently to a new account. So always, always check any unusual payment requests. A simple phone call could save you a small fortune and a whole lot of hassle!

Accountancy Help from THP

At THP Chartered Accountants in Chelmsford, Sutton, Wanstead and Saffron Walden we help business owners across the south east operate within their means – and get the most out of every penny.

Whatever aspect of accounting, tax planning or finance you need help with, we can provide it. Just give us a call on 020 8989 5147 to chat about how we can help.