Corporate watchdog ASIC has urged small businesses to be vigilant about payment redirection scams after the Australian Competition and Consumer Commission’s (ACCC) latest Targeting scams report showed that these scams caused the highest losses to businesses in 2021.
Payment redirection scams happen when fraudsters impersonate a business or its staff via email and request an upcoming payment be redirected to a fraudulent account.
In some cases, scammers hack into a legitimate email account and pose as the business, intercepting legitimate invoices and changing the bank details before sending out emails to the unsuspecting victims. There are also cases when scammers impersonate people using a registered email address that is very similar to one from a legitimate business.
According to ACCC’s data, overall, micro (businesses with 0-4 staff) and small businesses (with 5-19 staff) lost the most money to scams in 2021. Of the 3,624 reports received by Scamwatch with $13.4 million reported lost in 2021, $7 million was attributed to micro and small businesses. Small businesses had the highest median loss at $3,812.
Here are some steps businesses can take if they think they’ve been scammed:
- Stop sending money to the company and contact their bank
- Be wary of follow-up scam or offers to recover their money
- Report suspected scams to SCAMwatch or to the Australian Cyber Security Center
For investment scams involving a financial product or service, businesses can lodge a report of misconduct with ASIC, report it to their bank, and consider reporting the matter to the police.