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Invoice Fraud: Are You Paying Your Vendor Or a Thief?

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Fraud is everywhere. It seems in challenging times, such as this period of time with Coronavirus, criminal activity only increases, especially with digital crimes. I spoke with Brandon Spear, President of MSTS , which helps companies with B2B credit and accounts receivable management. He shared with us one aspect of fraud, invoice fraud, and what we can do to prevent it.

Because of “chip and pin” features of credit cards, credit card fraud has been slowed down. It’s now much tougher for criminals to use credit card data, so they’re turning to (or increasing) other methods.

A criminal will send you an invoice, that looks to be from a vendor you normally use.

But there’s something a bit different about the invoice and where it came from.

Could have come from an email address that looks like the address of the vendor, but maybe it’s spelled a bit different.

What’s also changed is the payment information. So if you pay that invoice, the money will go to the criminal and not to the vendor.

If you want to reduce, or even prevent, invoice fraud, Brandon suggests you ensure there are systems in place to manage paying your vendors. For a very small company with few vendors to pay, this is not a huge problem, but as you grow, it’s essential.

Before you pay an invoice, check it carefully so you’re not paying a criminal. [Go here for more articles on “cyber crime“.]

Beyond invoice fraud ensure you’re careful, overall, and secure your business.

  • Use complex passwords
  • Change them frequently
  • Train your staff
  • Hire a security expert to audit your network

Security is not something that you can “set” and forget. It takes constant vigilance and a review of your business.

Part of security is also considering the sustainability of your business when disaster strikes, which means you have to manage the unknown.

Previously posted on smarthustle.com by Ramon Ray.

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