Business fraud
I’m in business. What should I look out
for?
Fraudsters have developed a number of ways to target your business
accounts. These criminals could be working from outside or within
your organisation. They could be working alone or part of a larger
network, possibly with links to organised crime or terrorism. Below
are some of the means they use.
- Telegraphic transfer
Criminals send a request for the transfer of money from your
account, known as a telegraphic transfer request. These often
originate from other countries.
The fraudsters compromise your account in some way, obtaining
your account details. Then they’ll send a letter to your bank,
requesting a telegraphic transfer of funds to another bank account,
which is usually a legitimate business account, to pay for an order
of goods.
When that business receives the funds, they unwittingly dispatch
the goods to the fraudsters.
- Insiders
Recent investigations into major cases involving identity theft,
impersonation and the take-over of customer accounts have shown
that many cases depend on the complicity of collusive
employees.
Known as 'insiders', these employees are unlikely to be working
independently and more often than not are part of a larger,
organised group obtaining personal details from various
sources.
If compromised within one business, they will often be
re-positioned into similar employment with access to the same
material and the same potential to inflict financial loss.
They are especially valuable to the criminal fraternity while
working at bank counters, as they can serve the 'foot soldiers'
sent out to present stolen or counterfeit cheques or withdraw cash
in fraudulent card transactions. This instantly negates the need
for detailed, credible identity documentation to be produced and
other preventative systems can be over-ridden.
- Employees
As well as placing people within your organisation, be aware that
criminals do also try to recruit existing employees. They typically
target specific workers and make their initial approaches in a
social setting, such as in a pub. Often, employees inadvertently
give away a few pieces of seemingly harmless information in
conversation and due to their worry that they have committed a
crime can be coupled with threats of violence if your employees do
not agree to provide the information which the criminals
need.
What should I do if I suspect an
employee?
If you have concerns over your employees’ intentions, whether in
banks, building societies, foreign exchange bureaus or the less
obvious but increasingly common call centres or mobile phone
companies, think twice before you act.
Understandably, companies have concerns about their liability
should a suspected individual be allowed to continue their
activities, even though monitored. But we would urge you to take a
long-term view.
Simply confronting and sacking an individual is only a
short-term solution. It’s an approach that has come back to haunt
many businesses who have released an employee without taking them
to task, particularly where that individual’s new employer starts
asking questions.
Develop a Consultation Plan with the City of London Police Economic
Crime Department to ensure you have a course of action that works
in everybody's interests.
We urge all businesses to report such concerns to the police as
early as possible. Often, when we are brought in at the eleventh
hour so much evidence can have been lost, along with any chance of
identifying other collusive employees or the organisers.
Notifying us early will mean we can employ a number of
sophisticated techniques to explore the problem without alerting
the suspect and hopefully prevent them and their associates moving
on to new ground.
How can I prevent my employees from being recruited as
insiders?
One of the best prevention methods is education and, along with
setting up whistle blowing facilities, there are few more
cautionary methods than to make an example of a collusive employee
and keep their previous work colleagues informed of their progress
through the criminal justice system.
Contact us if you would like more information on things you can
do to support employees who may have come under pressure from
criminals to pass information.
I’ve been asked to pass on information.
What should I do?
You could earn a community action award by contacting one of the
following:
Crimestoppers:
Telephone:
0800 555 111
Web :http://www.crimestoppers-uk.org
City of London Police fraud
desk:
Telephone: 020 7601 6999
Fax: 020 7601 6938
Email:
frauddesk@cityoflondon.police.uk
Fraud Prevention Helpful
Hints
- Issue a statement of company integrity. This should provide a
clear message from the boardroom about the organisation's legal and
ethical values
- Develop an anti-fraud policy and culture which ensures that
commercially prudent measures are taken. This should be determined
by management, and be commensurate with operational activity
- Know your staff. Many frauds are committed in collusion with
staff. Check CVs and take up references. The more sensitive the
holder's position, the more detailed your enquiry should be. When
staff move within an organisation, remember to change their
computer and building access level
- Encourage a whistle-blowing philosophy within your company.
Very often other employees know or suspect something but do nothing
about it
- Have broadly-based and effective contingency and recovery
plans. Have powers vested in managers to cancel or freeze
transactions as soon as fraud is discovered. Undue delay often
means that funds have been transferred beyond reach
- Take a hard line on culprits. Give a clear message that they
will be caught, prosecuted and, where necessary, pursued through
the civil courts to recover losses.