The rise of invoice fraud and why you can’t afford to ignore it

Cybercriminal groups are more likely to become more sophisticated and organised, along with developing enhanced, streamlined methods for targeting Australians, no matter the size of your business, services you deliver or even industry you’re in.

Since COVID-19 Scamwatch has reported a significant rise in payment redirection scams costing Australia’s small businesses $14M in losses.

Along with a recent survey released by Xero showing the impact fraudulent invoices have on the Australian SME community, 1 in 5 respondents out of 1,000 small businesses, have been targeted with fraudulent invoices, with 18% falling victim to invoice fraud.

You think about it, the pandemic has significantly increased Australian dependence on the internet, working from home, using your personal or work computers, sending invoices, or emailing account details because that is what you used to do before (which by the way still happens to date), not only impacting you, but hackers can also gain access to your vendors details, impacting the supply chain, which now impacts all involved with major financial loss.

Imagine your invoice is paid, but to someone else by accident!

We understand that many Australian businesses are also recovering to maintain a positive cash flow position, but if we now look at the effort in time which is needed on bookkeeping tasks, along with now needing to have extra vigilance in all your digital transactions, no wonder some Australian businesses are getting caught out by online scammers.

Just imagine, now understanding the effort it takes to generate and manage your accounts to get paid, imagine if one small oversight could have been avoided by spending the time to really look into to your IT set up to safeguard your devices and all round business security along with your bookkeeping and accounts process?

Let’s look at a local sporting club where they paid $150K to a scammer:

1. The local netball club decided to fundraise to refurbish the netball courts – we all know how much effort this takes, particularly for a local community netball club
2. The tradies hired, completed their job and issued the netball club an invoice via email in a word/pdf version to the accounts contact at the netball club
3. The accounts contact at the club logs into a laptop as they do, to pay invoices. But what they don’t realise, their email account has been compromised and the scammer has altered the invoice payment details and managed to send the club a new email with the tampered invoice.
4. The invoice is paid to the scammer leaving local tradies $150,000 out of pocket, along with the netball club experiencing a major financial loss
5. Source: Tailem Bend Netball club warns of elaborate cyber scam

It’s a tad shocking to say the least reading the above information and also overwhelming for most Australian Business, no matter what size, in particular for sole traders, contractors, freelancers, tradies, virtual assistants and SME’s in general, whose labour of love can quickly turn into major financial loss.

I am sure you’re asking yourself, what now?

Well, when 89% of SMEs consider cyber security important, we listened!

Industry leaders from Cyber security, Fintech and IT come together on Wednesday 23 February to deliver a fantastic event “How to give your business champagne level security on a beer budget” where small business owners walked away with instant value they can now start implementing into their businesses straight away.

Topics covered:

1. How AustCyber is helping to secure our economy by encouraging businesses to build cyber security into their offerings, to build greater digital trust
2. How LUCA Plus uses blockchain technology to navigate invoice fraud and email compromisation and how e-invoicing has been considered an emerging tool to create a safer and more effective way to manage invoices and bills, now and into the future
3. How Digital Humdrum can help you navigate and simplify Cyber & IT terminology and also help you identify gaps in your business
4. How the FortNynja help Australian Businesses to identify, plan and implement IT & Cyber strategies to future proof their businesses from cyber threats and IT gaps

Speaker line up:

1. Paula Oliver is the Manager for the South Australia Cyber Security Innovation Node in Adelaide. This is housed in the SA Governments’ Department for Innovation and Skills.
2. Georgia Heath is a Digital Strategist at Digital Hum Drum
3. Ray Wang, is our Co-Founder and CEO at LUCA Plus
4. Jenna Huey and Fang-ming Lim, FortNynja IT and Cyber Strategist
5. Breakout room collaborators: Sharon Phillips, Digital Hum Drum, Gary Paradise, Director Concept Data and Nick Sincock, Department Home Affairs will deep dive into the learnings from the above speakers to help you with practical solutions and tips to hit the ground running after this webinar.

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About LUCA Plus
To date, LUCA Plus has helped several sole traders, small to medium-sized businesses and micro businesses solve the challenges caused by manually processing invoices, chasing payments and removing the potential risk of invoice fraud.

Other articles:
https://www.abc.net.au/news/2020-11-24/business-email-scam-tradies-computer-hacked-costs-51000/12817584

https://www.cyber.gov.au/acsc/view-all-content/guidance/tax-scam-stories/rajivs-story

References:

Xero Survey and article https://www.accountantsdaily.com.au/business/16369-1-in-5-smes-targeted-with-fraudulent-invoices