UK businesses targeted by fraud

The first 6 months of 2015 has brought a sharp increase of fake invoices being sent out to small businesses according to Action Fraud.

Almost 750 companies have reported falling for this scam between January and June 2015.  A stark increase compared to the 603 victims throughout 2014. This number can potentially be a lot higher as a result of under-reporting.

Action Fraud say “It is important that employees are made aware of invoice scams and are ready to recognise the signs of fraud”.

What’s the scam?

The scam typically involves fraudsters acting as a supplier to the company whilst changing the account details for the invoices. An employee might innocently update the account details only to find out later that they have been sending money to the fraudsters rather than the original supplier.

The more information the con artists have on the business, the higher the odds are of success. It has been found that in some cases, corrupt insiders are feeding back information about business’ genuine suppliers.

“Incidents of invoice fraud are under-reported and therefore it is difficult to know the true scale of this fraud type. However, what we do know is that this prevails across all types of business and no one type of industry is immune. Those organisations that are worried they may fallen victim to fraudsters should always report to Action Fraud,” said Pauline Smith, the head of Action Fraud.

Fraudsters have been known to use summer as a time to take advantage of the lack of experienced staff on site, targeting less experienced or temporary staff who may be less likely to identify the scam.

This is an issue that affects companies of all sizes, however for small businesses it may prove more difficult to recover the money if they are stung. Surrey Police have recently said that they are investigating two allegations where companies have lost around £1m.

Find out top tips for how to avoid becoming a victim of this scam from Cifas here