Payment Fraud

Payment Fraud: Protecting Your Business from Financial Deception

 

Payment fraud is a growing threat to UK businesses, with criminals employing sophisticated tactics to trick companies into transferring funds to fraudulent bank accounts. This type of fraud, often called Business Email Compromise (BEC) or invoice fraud, can result in significant financial losses.

 

Common tactics include:

  1. Email impersonation: Fraudsters hack or spoof email accounts of executives or suppliers, requesting urgent payments.
  2. Invoice manipulation: Criminals intercept legitimate invoices and alter payment details.
  3. Fake supplier communications: Scammers pose as vendors, claiming to have changed their bank details.
  4. CEO fraud: Impersonating senior executives to authorize large transfers.
  5. Social engineering: Using publicly available information to make scams more convincing.

 

To protect your business:

• Implement robust verification procedures for all payment changes.
• Train staff to recognise red flags, such as urgent requests or pressure tactics.
• Use multi-factor authentication for email accounts and financial systems.
• Regularly update and patch all software and systems.
• Verify any changes to payment details via a known, trusted contact number.
• Implement dual authorisation for large transactions.

 

If you suspect fraud:

  1. Contact your bank immediately to try and recall the payment.
  2. Report the incident to Action Fraud (0300 123 2040).
  3. Preserve all evidence, including emails and phone records.
  4. Inform your cyber insurance provider, if applicable.

Remember, legitimate businesses rarely change payment details suddenly or pressure for immediate transfers.

Always take time to verify requests, even if they appear to come from trusted sources. By implementing strong internal controls and fostering a culture of security awareness, businesses can significantly reduce their risk of falling victim to payment fraud.