Finance departments warned of supplier fraud
FINANCE departments across the region are being warned to watch out for a rise in supplier fraud.
The forensic team at KPMG’s Leeds office has seen an increase in the number of clients receiving official looking letters purporting to be from one of their suppliers.
The fraud works by a company receiving a letter advising of a change in banking arrangements for one of their suppliers.
It states that all future payments should be settled to a new bank account and those details are shown in the letter. The hope is that the organisation then updates their files and subsequent payments are made to this account.
Vivien Osborne, a director within KPMG’s Yorkshire forensic team, said: “This is a troubling rise in an old style fraud. Often many businesses which have amended a supplier’s details do not realise there is a problem until they are chased for payment by that supplier.
“A number of well known organisations have been tricked in this way, involving significant amounts. In one case we recently investigated the attempted fraud was in excess of £1m.”
“Being aware of the scam significantly helps to mitigate the risk. However, companies must ensure they take the necessary precautions to make sure they do not fall foul of this simple but potentially very costly fraud,” she added.
