ASIC warns small businesses to be vigilant about payment redirection scams
25 July 2022
- According to the ACCC, payment redirection scams caused the highest losses to businesses in 2021
- The ACCC’s Scamwatch received more than 3,500 reports from small businesses in 2021
- Small businesses should be vigilant, especially around payment redirection scams, and they should report scams to the relevant authority
ASIC urges small businesses to be wary of payment redirection scams as the latest Targeting scams report from the Australian Competition and Consumer Commission (ACCC) showed that these scams caused the highest losses to businesses in 2021.
Payment redirection scams involve scammers impersonating a business or its employees via email and requesting an upcoming payment be redirected to a fraudulent account.
In some cases, scammers hack into a legitimate email account and pose as the business, intercepting legitimate invoices and amending the bank details before releasing emails to the unsuspecting business. Other times, scammers impersonate people using a registered email address that is very similar to one from a legitimate business.
The ACCC’s data shows that overall, micro and small businesses lost the most money to scams in 2021. Micro businesses are defined in the Targeting scams report as those with 0-4 staff, while small businesses are defined as those with 5-19 staff.
Scamwatch received 3,624 reports from businesses with $13.4 million reported lost in 2021. Of that, $7 million was attributed to micro and small businesses. Small businesses had the highest median loss at $3,812.
ASIC has information on the steps small businesses can take to protect themselves and has previously warned small businesses to look out for scammers who impersonate ASIC.
Reporting scams
If you think you’ve been scammed:
- Stop sending money to the company and contact your bank.
- Be wary of falling for a follow-up scam or offers to recover your money.
- Report suspected scams to SCAMwatch or to the Australian Cyber Security Centre at ReportCyber.
ASIC is interested in being informed of investment scams involving a financial product, such as:
- financial products and services promising returns that are too good to be true
- phone investment scams
- pyramid marketing schemes involving a financial product.
If you think your business has been scammed in relation to a financial product or service, lodge a report of misconduct with ASIC, report it to your bank and consider reporting the matter to police.
Source: ASIC
