Thank you to PC Jac for forwarding this information on.
(Note from Malc – I am personally aware of a narrowly avoided £20k scam from this exact problem that happened to one of my clients. It’s a real problem that has just got worse. It’s not just for businesses either, everybody can be affected by this.)
COVID 19 MANDATE FRAUD
The threat from mandate fraud has increased during the COVID-19 response. This could result in organisations losing substantial amounts of money that will be difficult to recover. However, whilst mandate fraud is becoming more sophisticated, it is entirely preventable if your organisation is aware and takes the threat seriously.
The threat from mandate fraud is increasing because the public sector has had to rapidly adapt to new ways of working and is necessarily spending money quickly to deal with COVID-19. This has created new vulnerabilities, which criminals are seeking to take advantage of. This type of fraud carries low risk and potentially high rewards for criminals.
We have already seen instances of attempted mandate fraud around the COVID-19 response. We should not underestimate the sophistication of this fraud. It is not just people emailing to ask for bank accounts to be changed, those attempting it have often harvested information on their targets and use sophisticated techniques to impersonate your suppliers.
However, by being alert to the fraud risk and by ensuring you and your organisation follow some simple checks, you can significantly reduce the likelihood of falling victim to it.
Mark Cheeseman, Director Government Counter Fraud Function
What is Mandate Fraud?
It is a fraudulent request to change a direct debit, standing order or bank transfer mandate in order to divert payments or to create new payments.
It can affect customer, supplier or employee bank accounts. It is also known as creditor fraud, payment diversion fraud or supplier account takeover fraud.
How Does Mandate Fraud Happen?
Criminals will gather information about your suppliers, customers or senior employees from different sources to make them look legitimate when contacting your organisation. This can vary from simple to in-depth information. This helps them to impersonate organisations and individuals convincingly.
They will make a request to change the bank details by a number of methods:
Telephone: criminals will impersonate a genuine supplier and often call with an urgent or time critical
reason to get changes made in a hurry.
Written requests (letter or fax): criminals will create fictitious but convincing letters or faxes which quote
publicly available information such as company registration and director details.
Email requests: criminals will ‘spoof’ email addresses and include fabricated but convincing content to appear legitimate.
How to Prevent Mandate Fraud
- Be alert and suspicious of any requests to alter bank details – criminals are targeting us.
- Be especially vigilant with changes close to a payment date – or changes closely followed by invoices.
- Check contact details contained within phone calls, letters or emails received and validate all requests for bank account changes using established contact details.
- Report unexpected or unusual emails that have unknown links or attachments.
- Ensure that a senior member of your finance team reviews and formally authorises the change of bank account details.
- Review bank statements and payment records regularly and report anything suspicious to your bank immediately.
- Avoid disclosing sensitive information about your suppliers to unknown third parties.
- Shred confidential documents before throwing them away
- Assess your security policies on a regular basis and ensure that all staff are briefed and trained to spot potential fraud.
You can contact the Government Counter Fraud Function by emailing
covid19-counter-fraud@cabinetoffice.gov.uk
There’s more to read if you download the Government’s PDF doc here:
You can contact Jac if you have any concerns or advice:
Jaclyn Irving
Georgetown, Calside and Caerlaverock Community Constable
Dumfries Community Policing Team
Loreburn Street
Dumfries
DG1 1HP
Telephone: 101
Leave A Comment