Cybercrime is on the rise, and businesses of all sizes are increasingly becoming targets. One of the most common tactics used by fraudsters is invoice interception. By hijacking legitimate invoices and altering banking details, these criminals can divert funds into their own accounts, and it is highly likely that you may never see these funds again.
To safeguard your business from invoice fraud, follow these essential steps:
- Centralise Your Supplier Information: Keep all supplier details, including bank account information, in a secure, centralised location like your accounting system. Generate payment files directly from your accounting software to reduce the risk of errors and fraud.
- Verify Changes Personally:
- Always verify any changes to supplier banking details through a phone call.
- Avoid confirming changes via email, as this could be a trap set by fraudsters.
- When calling, use the official phone number listed on the supplier's website to ensure you speak to the right person.
- Be Wary of Unsolicited Contact: Never trust incoming calls or emails requesting changes to payment details. If you receive such a request, hang up and contact the supplier directly using their phone number listed on the official website (use a search engine such as Google), as the email or letter received could also have a fraudulent phone number on it.
- Review Supplier Master Files Regularly: Conduct regular audits of your supplier master file to identify and remove inactive or duplicate suppliers. This helps to prevent accidental payments and reduces the risk of fraud.
- Implement Strong Internal Controls: Develop clear policies and procedures for handling supplier changes and payments. Ensure all employees are aware of these procedures and the potential risks of invoice fraud.
Invoice fraud can have devastating consequences for your business. Taking proactive steps to protect your finances can significantly reduce the risk of falling victim to this crime.
How Cutcher & Neale Can Support You
At Cutcher & Neale, our Club & Hospitality team is dedicated to safeguarding your business from financial risks. By leveraging advanced data analytics, we can pinpoint potential vulnerabilities within your financial systems, such as invoice fraud. Our team can help protect your business by reviewing your supplier master file and implementing industry best practices.
To further strengthen your financial controls, we recommend updating purchasing and payment policies to outline clear procedures for changing supplier details, especially regarding bank account information. These policies must be communicated to all employees, particularly new starters.
Our data analytics software and expert team enable us to review your supplier master file thoroughly. Through this process, we often identify issues like duplicate suppliers or missing ABN details. We recommend an annual review of this file to ensure accuracy and prevent errors. Inactive suppliers should be removed or marked accordingly to minimise the risk of incorrect payments.
