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How can I protect my company from electronic bank transfer fraud?

Businesses face a growing threat in person, over the telephone or through e-mail from fraudsters pretending to be someone they are not, in order to secure bank account access details. These money transfer scams are the most common scams that consumers fall for with banks and insurers suggesting that this is now a daily event with circa 50, or so, a day being successful.

Written by Kate Slater on 8th April 2015

How can I protect my company from electronic bank transfer fraud?

Businesses face a growing threat in person, over the telephone or through e-mail from fraudsters pretending to be someone they are not, in order to secure bank account access details. These money transfer scams are the most common scams that consumers fall for with banks and insurers suggesting that this is now a daily event with circa 50, or so, a day being successful.

Another one of our corporate clients has just been targeted and reported the following attempted electronic transfer scam:

Yesterday we received a call from the "Fraud Department” of our bank.  The caller correctly identified themselves and our bank by name. They also correctly named our account and the correct numbers of the account that they were calling about.

The caller said a fraudulent transaction had been attempted from our account, but had been blocked and referred to the bank’s Fraud Department. We were told that the reason the transaction had been stopped was because the Fraud Department could tell the IP address was not ours and was from the Aberdeen area.

 

The call was received in our Accounts Department and to reassure our colleague the fraudster correctly identified a recent transfer into our account naming the right client, date and amount.

We were informed that our online account had been frozen and we needed to talk through one or two transactions, one of which was they suspected a fraud attempt. They would then release our online account and delete the large fraud transaction.

They asked our employee to log-on to our system, they had and I have listened to the call, the same screen at their end. The ”Bank Fraud Team” then talked our employee through the process and asked for certain elements of the employees’ password, for example 3rd, 6th and 10th character – making it clear they should not disclose the full password. It was clear now that they were logging on at their end so they could take control of our system and try to make a transfer themselves.

Fortunately our employee became nervous and spoke to a colleague who had concerns about the call and the fraudsters were rumbled.

As a result of further work, it was clear that the fraudsters were working a chain and had already attempted the same trick on a client and that is where they got our account name and number and transaction details to use in a way that would help them to reassure us that we were speaking with our bank.

 

 


So how do I protect my company from electronic bank transfer fraud?

  • Talk to your team now and share stories like this about the methods fraudsters use to gather and mine information from them. Doing this before you have a problem, as a training session, is much easier than missing the boat and managing the problem.
  • Ensure that all supplier invoice queries, or notifications of bank changes, are verified with the supplier, or bank, ideally over the phone with a known contact.
  • If your company accepts online payments ensure that you opt to include the secondary identity verification, whereby the customer needs to enter a verification code before the transaction is accepted for credit and debit card transactions
  • Ask your bank for their policy on fraud, so that your team know what procedure to follow if this situation arose
Fortunately, on this occasion, our client rumbled the scam and sleep easier in the knowledge that Franklands has arranged cover for up to £100,000, for electronic bank transfer fraud, under the Crime Cover section of their Management Liability Policy.

 

In our experience not enough Insurance Brokers are talking about this risk and you should check that you have this valuable cover, or speak to Franklands for more detailed information and a quotation.


 

See other blogs related to: Fraud

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