Over the years, criminals have continued to successfully scam business owners and their employees into authorizing illegal wire transfers. This type of fraud is rampant across the country, and so we want to make you aware of some of the specific tactics that criminals use to trick or manipulate individuals into unknowingly assisting them in committing wire fraud.
One of the first things a criminal will do is identify who can authorize a wire transfer. This person typically holds a very senior position within the company, or perhaps they’re a customer or vendor you work with. Using company websites, social media and other public information, the criminal will piece together the hierarchy of the company. Perhaps they will even call the company posing as a customer or a vendor. While the conversation may seem benign or routine, they’re really gathering information that will validate their path through the company or help them gain further access or insight.
Once they know who can authorize a transfer, they will work to compromise their e-mail account either through malware or other illegal tactics. Alternatively, they may set up an email account with an address that closely resembles that of the authorized individual.
The criminal then uses the fake or compromised e-mail account to send a message to an employee at the business and instruct for the funds to be wired to a designated account. Since the e-mail appears to come from a legitimate source, the employee will act on the request and send wire instructions to the bank, thus resulting in a monetary loss. Because wire transfers are good funds when sent, and the settlement of the wire at the receiving bank is immediate, recovery of the funds is very difficult or impossible. It has also been noted that many of the fraudulent wires are sent on a Friday, giving the criminal more time to withdraw the funds before the company can act. Recently there are examples of consumers involved in buying a home that have lost their down payments as a result of this same scheme. A legitimate looking email message is sent to a buyer appearing to have been sent by the realtor or settlement attorney. The message instructs the buyer to wire their down payment in advance of settlement to a bank account allegedly belonging to the seller.
There are important steps that you can take to protect your business, clients and employees from this unfortunate scenario.
If you suspect wire fraud, immediately contact the Commercial Business Center at Sandy Spring Bank at 866.867.1570. You should also contact the FBI, www.fbi.gov/contact-us/field, email: CyWatch@ic.fbi.gov, or call: 855.292.3937.
If you have any questions, please call us at 866.867.1570. Thank you for your trust and business.