Posted by

Katy Worobec, Director, Financial Fraud Action UK

28 Oct 2016

A quick phone call or email is all it can take to devastate an entire business.

Companies across the country are increasingly being targeted by sophisticated scammers and incidences of financial fraud are on the rise. Despite these dangers, I was concerned to learn that the majority of businesses are not taking steps to protect themselves when it comes to fraud.

New research suggests that almost half of business leaders do not believe they will fall victim to financial scammers. More worryingly, most admitted they had never heard of common business scamming tactics, such as when fraudsters impersonate a CEO in order to extract a financial payment.

The research was carried out on behalf of Take Five, a new national campaign designed to combat financial fraud in the UK. Backed by all the UK’s major banks and key financial services providers, Take Five is designed to help put consumers and businesses back in control with straight forward advice to help prevent fraud. This includes reminding everyone that it pays to stop and think. 

This is particularly true when it comes to combatting business fraud. Scammers often work on the principle that those they target will assume the request or instruction is coming from a trusted source – such as a CEO – and automatically make a payment or share classified details.

Too often I hear stories where fraudsters use spoof emails to impersonate a senior member of staff in order to deceive employees into transferring money, or pose as a regular supplier to a company and request a change in bank account details. It might surprise you to learn how easily and frequently these types of scams work. Often with catastrophic consequences.

The reality is that businesses of all sizes can be affected. That is why the campaign is encouraging business leaders and employees to be more vigilant when it comes to the tactics fraudsters deploy.

There are some simple steps you can take to protect your business:

  1. Ensure all staff who process supplier invoices and who have authority to change bank details are vigilant
  2. Any changes to supplier financial arrangements should always be verified with that supplier using established details you hold on-file
  3. When a supplier invoice has been paid, it is good practice to inform that supplier of the payment made, including the account the payment was made to
  4. Check company or organisation bank statements carefully. All suspicious debits should be reported to your bank immediately
  5. Fraudsters conduct extensive online research to identify suppliers to particular companies and organisations. Consider if it would benefit your company or organisation to remove this information from your website and other publicly available materials
  6. Do not leave bills lying around for others to look at and record details of standing orders and direct debits
  7. Educating staff is key when it comes to preventing CEO fraud. Ensure everyone in the business, and especially finance staff, are aware of this type of scam and make sure staff can challenge unusual requests. Consider putting in place a system which strengthens the controls around transfers. This could include requiring approvals from two different people apart from the requestor to initiate a transfer

Above all else please do remember to Take Five – to pause and think – before responding to any requests to share financial details. By doing so we can all play an active role in protecting everyone from financial fraud.

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