New Zealand CAs are being urged to be extra vigilant about financial crime, with the number of frauds and scams targeting businesses on the rise.
That’s the message from Westpac NZ senior manager of financial crime, Tracey Brown, who says that as accounting firms strengthen their IT crime defences, fraudsters are responding by increasingly targeting people rather than systems.
“All it takes is one staff member, or even the CEO, to click a link in a phishing email or miss the red flag in a payment request and your business could lose a lot of money or suffer reputational damage.”
“Empowering your people to understand the tactics fraudsters use – as well as regularly reviewing your fraud defences – will give you the best chance of preventing financial crime.”
“Empowering your people to understand the tactics fraudsters use … will give you the best chance of preventing financial crime.”
Financial crime increasing in NZ
Westpac NZ has seen a pick-up in scams such as invoice, payroll payment and transactional payment fraud driven by criminals using data acquired on the dark web.
This data includes usernames and passwords for email and bank accounts, stolen credit card numbers, identity documents and contact details, which are used by fraudsters to impersonate employees, customers and suppliers.
This ill-gotten information forms the basis of elaborate and realistic scams – often carried out by email – that can have devastating impacts.
“They can cause untold damage by attempting to steal money, locking you out of the system until you pay a ransom or threatening to cause reputational damage by releasing sensitive information,” says Brown.
Common scams to watch out for
While there is a host of ways criminals try to fleece NZ businesses via email, there are a few methods that are particularly popular at the moment.
Fraudsters use payroll payment fraud to impersonate an employee requesting a change of bank account to siphon the employee’s salary.
Scammers attempting a business invoice fraud access a business’s email account to intercept and edit the account number on an invoice, resulting in the scammer getting paid instead of the firm.
Other popular email-based frauds at present include the gift cards for clients scam, the past-due invoice scam, the tax email scam and real estate scams where fraudsters get their hands on housing deposits, often by hacking the email accounts of law firms.
Top tips to protect your business
To safeguard their firms from fraudsters, Brown advocates that CAs teach their staff – and their firm’s clients – to recognise red flags in their inbox, such as emails that contain a request to change accounts, payment requests that come through at odd hours or with an unusual urgency.
It’s also a good idea to double-check the accuracy of email addresses when sending sensitive information and to check via phone any supplier that wants a payment change by email.
Keeping the firm’s payroll and systems up to date is also key, Brown says.
Consider investing in software that detects phishing emails and implement email security measures. Use software, spam and phishing filters that automatically scan emails and email addresses for spam and ‘spoofing’ emails.
Additional safeguards against scams include mandatory employee training on the issue and encouraging staff to speak up if they suspect something’s amiss.
“Everyone is trying to become more automated and efficient, but teaching your people to evaluate emails or payment requests with a critical eye could end up saving your business a lot of money down the line,” Brown says.
For those that fall victim to scammers, Brown’s advice is simple – act fast and contact your bank immediately.
Find out more
Refer to the full thought-leadership piece on Westpac’s website.
The content of this article is intended for information purposes only. It does not take your particular financial situation or goals into account and you should use your own judgment regarding how such information should be applied in your own business. Westpac make no warranty or representation, express or implied, regarding the accuracy of any information, statement or advice contained in this article. We recommend you seek independent legal, financial and/or tax advice before acting or relying on any of the information in this article. All opinions, statements and analysis expressed are based on information current at the time of writing from sources which Westpac believes to be authentic and reliable.