The supplier's email was hacked

The scammers hacked into a supplier's email and changed their bank details. The scammers then sent invoices with amended bank details and the prior email trail to and from the supplier. It appears the scammers gained access to the supplier’s IT system as the invoices were perfect copies of a real version, including the actual email of the supplier. As the payment request appeared legitimate, payments of $190,000 were sent. However, all communication to the email address was diverted from the supplier. The scam was discovered when the supplier directly contacted the payor via phone to discuss the missing payment.

Signs this was a scam

The change in bank details was the only sign that this was a scam. Scammers often pose as one of your regular suppliers and tell you that their banking details have changed. They may tell you they have recently changed banks and may use stolen letterhead and branding or even hacked emails to convince you they are legitimate. The scam was difficult to spot, as the invoices looked genuine, and the scammers included copies of previous invoices.

The business even checked that the email address of the sender matched the supplier's email address.

Tips to avoid this type of scam

• Contact suppliers directly using a second, reliable mode of communication, such as a known phone number, to verify any request to change bank details.
• Consider a multi-person approval process for transactions over a certain dollar threshold with processes in place to ensure the business billing you is the one you normally deal with. 
• Prevent your IT systems from being compromised.  Keep your IT security up-to-date by regularly patching your systems and running antivirus software, and have a good firewall to protect your data. 

For additional information, click the Fraud Education menu on our homepage, where personal and business fraud education is available.

For more information about First Reliance Bank, visit one of our branches today, call (888) 543-5510, or email CustomerCare@firstreliance.com.