If you look at financial frauds, the one that has been on the rise for a while now is Authorized Push Payment. In fact, last year, it represented 75% of the financial fraud that companies suffered from. Additionally, other types of financial fraud that businesses may face include payment fraud, business email compromise, false invoicing, and investment scams, among others. Let us take a closer look at the situation and to some of these fraud mechanisms.
What is Authorized Push Payment Fraud?
Authorized push payment (APP) fraud has become the biggest threat for businesses. It is a financial scam in which criminals manage to get businesses to send a payment into their account. To do so, they often pose as a legitimate supplier. The biggest problem caused by APP is that once a payment is made, it is almost impossible to recover the funds. Most of the time, as soon as the money comes into an account, it is moved to another one right away, far from the jurisdiction in which the crime took place. In order to solve that issue, a company can turn itself to a solution such as SIS ID. It provides businesses with an anti-fraud solution for authorized push payment (APP) fraud that incorporates machine learning algorithms, a fraud case database and customizable rule-based fraud detection systems. It assists them in preventing and mitigating fraudulent financial activity inside their company. Click on the link to read more on the subject.
What is Business Email Compromise (BEC) Fraud?
Business Email Compromise (BEC) fraud is a phishing scam in which criminals use various tactics to gain access to a business email account. They sometimes pose as a high-level executive of the company, in order to manipulate an employee into transferring money in their own account. This fraud is often based on an elaborate scenario and is meant to obtain large sums of money illegally. Around the world, the business email compromise fraud has caused over $26 billion in losses, over the last seven years. The best solution to prevent this kind of scam is to educate employees on the subject and to direct them on never transferring any money to an unknown party. And if someone pretends to be from inside the company, they need to go directly to the source to verify if the request is real or from fraudsters.
What are Investment Scams?
Investment scams are fraudulent activities designed to deceive businesses into investing in fake or fraudulent investment opportunities. They often promise high returns with little or no risk, which in fact should alert the person in charge. These scams can be perpetrated through various channels, including email, social media and phone. Anyone being contacted out of the blue to take part in an investment and does not know personally know the individual or the group inviting him to do so, should stay clear of it. Forwarding the e-mail to the authorities may also be a good idea, in order to protect other potential individuals from being scammed.