International Fraud Awareness Week runs this week from 17 to 23 November. During this week, many organisations come together to try and raise awareness around the causes of fraud and to improve education around how to prevent fraud.

What is fraud? 

The term fraud encompasses actions that are meant to deceive for financial or personal gain. It’s any intentional or deliberate act to deprive another of property or money by guile, deception or other unfair means.

How much is lost through fraud? 

Fraud losses are staggering each year. The Banking and Payments Federation of Ireland indicated that monetary loss from fraud in 2022 cost €84.6m and the total number of fraudulent transactions was 324,000. The level of fraud is growing each year with the frauds becoming more elaborate.

How to Spot Types of Fraud 

There are many different types of fraud. We have set out below some of the more common types and how they are perpetrated. 

1. CEO Impersonation - This is a form of identity theft whereby fraudsters send out emails to employees pretending to be the CEO or other senior employee. The fraudster has taken over and impersonated a real email address or used deception to create an email address that looks like the real one. The fraudster then requests payment of invoices or transfer of funds into a bank account. The bank account, while real is used to divert funds illegally. 
2. Invoice redirect - This type of fraud occurs when a business receives an email proporting to be from a legitimate supplier and advises the business that bank account details have been changed. Unless the person receiving the email confirms details with that supplier, when payment is made, the funds are diverted to the fraudsters bank account. 
3. Phishing texts, emails and calls – the fraudster will use social engineering to request details such as PIN numbers, account details, email addresses etc by creating an alarming event that looks real such as the illusion that there has been suspicious activity on the individuals bank accounts 
4. Investment scams – also known as Pig Butchering, the fraudster plays a long game by slowing drawing an unsuspecting individual in. Falsified marketing material, websites, testimonials and meetings with “real” individuals in an effort to lure people in. There are promises of exceptional returns with low risk and unsuspecting people are often lured in.

How to Protect against Fraud 

If you are aware of the scams, you can help protect yourself and your business by taking some simple steps: 

• Create policies and procedures around fraud. These should highlight the fraud red flags and give direction and guidance on the types of behaviour and other safeguards that are acceptable in the fight against fraud 
• Training – businesses should help protect themselves by organising awareness training around fraud. The better prepared people are to spot the signs and triggers the better chance you have of protecting against theft and loss 
• Never respond to text messages and never enter PIN details or other sensitive information on links received in texts or emails. If in doubt, call the business from where the text or email originated and confirm directly with a person 
• Watch for emails that look unusual. CEO impersonation emails and Invoice Redirect emails often look innocent but look carefully for misspellings, incorrect titles, poor grammar etc that might give clues to the fact that they are fake 
• Never open attachments that look suspicious – these could be malware that are masquerading as legitimate attachments 
• Enable 2 Factor Authentication on payment platforms, mobile banking etc to add a layer of protection 
• Never respond to anything when you are in a rush or potentially distracted by something else that is happening. Fraudsters work on the basis that people are rushing and don’t have time to double-check the details
• If it looks too good to be true, it probably is – if in doubt say no and get a second opinion 
• If you are being asked to make an investment, always seek professional financial advice from an appropriate person

How can RBK Help? 

Our GRA team is here to help you. We can conduct an internal controls review focused on fraud controls. This can provide assurances that there is an appropriately designed internal control framework to migitate against the risk of loss due to fraud. 

If you have been the victim of fraud, we can carry out a review to determine how and why it happened and provide a report of mitigating actions that should be taken. 

For more information, contact us today.