Payroll Diversion, Supply Chain Crime Raise B2B Payment Fraud Alerts

Criminals are creative, and when it comes to corporate payments, there are a plethora of ways scammers can infiltrate a transaction workflow to steal not only money, but also goods. This week’s B2B Data Digest looks at some of the biggest stories in B2B payments fraud, including a post-payment supply chain theft and a dramatic surge in payroll diversion crime.

$72.50 payment requests are being sent to new businesses in Wisconsin, and authorities are warning that the mail campaign is a scam. According to the Wisconsin Better Business Bureau and the state Department of Financial Institutions, a new mail scam is circling around new companies, claiming to charge the $72.50 for a false “Certificate of Status” payment. The scam involves a fake agency, local news reported, and represents a return to more analog and low-level scams that have recently given way to digital cyberattacks targeting higher-value payments from corporates.

333 percent more payroll diversion scams have hit organizations in the last half of 2020, new data from Agari revealed. The surge in criminal activity involves scammers posing as legitimate employees to redirect payroll deposits into mule accounts. It’s not the only scam that’s seen an increase in the last year: According to Agari, business email compromise (BEC) scams continue to climb. Researchers have identified an increase in one particular scam in which cyberattackers pose as an investment or insurance company to request a transfer of funds to meet supposed investment commitments. On average, this scheme targets a payout of $809,000 per target.

$312,000 was stolen from a Pennsylvania nonprofit in an accounting scam, according to local reports. The Pittsburgh Post Gazette said a woman has pleaded guilty to charges of embezzling funds. The former accounting coordinator, who did not have signature authority within the nonprofit, is accused of writing company checks to herself and forging her supervisor’s signature. The case is yet another example of the security risks of businesses relying on paper checks.

$36 million worth of copper was ordered by commodity trading house Mercuria, but its Turkish supplier actually sent a cargo of painted rocks, according to recent Bloomberg reports. The publication said the copper order was switched out with the worthless rocks before the shipment, weighing in at 6,000 tons across 300 containers, was sent to China. A lawyer representing Mercuria said criminals broke anti-fraud seals and switched out the copper for rocks. The buyer reportedly sent payment for the order well before it received the shipment, reflecting the risk of supply chain fraud that even the largest traders face.

$120 million+ has been stolen from businesses in Ireland via invoice redirect fraud, according to Independent.ie reports. Law enforcement said the 2020 thefts are the result of an increase in BEC scams, in which cybercriminals send an email posing as a legitimate vendor, requesting an invoice payment to their own bank account. Reports warned that in many cases, businesses are unaware of the fraud until the actual vendor requests payment to their own bank account. Law enforcement is urging Irish businesses to confirm payment requests via phone with their suppliers and trusted contacts.