Checklist: Seven measures to avoid falling victim to invoice scamming
Like many other forms of cyber crime, invoice fraud is on the rise — but the good news is businesses can take measures to avoid this form of fraud, which can hit you and your customers hard.
Invoice scamming involves cyber criminals impersonating businesses, intercepting emailed invoices, changing bank account details and then stealing the invoice amounts from unsuspecting customers. As soon as the money has been paid into a scammer’s bank account, it is often moved offshore, and banks and police then have little authority to do anything to retrieve the stolen funds. Usually, the customer or business that paid the invoice to the fraudulent account is liable for the loss, because the invoice hasn’t been paid to the correct organisation for the goods or services received.
Invoice fraud is a growing problem in Australia and often perpetrated by organised cyber criminals. Australian businesses reported more than $14 million in losses to the federal government’s fraud monitoring body Scamwatch due to payment redirection scams last year. Average losses as at March 30, 2021, were more than five times higher compared to average losses in the same period in 2020. However, total losses are likely to be much higher as these scams are reported to a range of different organisations and sometimes not reported at all.
What should you do?
Good payment practices by businesses and banks can help to avoid such outcomes.