Supply chain · 5 January 2016

Britain’s micro firms at increased risk from invoice fraud

Invoice fraud involves deceiving firms into making payments to fraudulent accounts by impersonating genuine suppliers
Micro businesses in the UK are increasingly under threat from invoice fraud a type of fraud whereby criminals deceive firms into making payments to fraudulent accounts by impersonating genuine suppliers.

According to the findings of a survey by the country’s fraud reporting centre, Action Fraud, more and more companies are experiencing fraud of this type. A total of 749 businesses reported it in the first half of 2015 as opposed to 603 throughout the whole of 2014 a large proportion of these being small firms.

Impacting businesses around the world, invoice fraud is thought to have amounted to $215m across 45 countries in the 14 months to December 2014.

Jonathan Williams of UK information services firm Experian warns that UK firms should take proper steps to ensure proper protection.

official statistics give an idea of the pace at which invoice fraud is increasing amongst small businesses, he said. It has become a sophisticated enterprise, so spotting it before it happens is a significant challenge.

electronically checking the ownership of business bank accounts is an approach which could revolutionise how businesses set up and pay others, as well as protect themselves from significant losses and damage to supplier relationships.

Electronic solutions can used by small business owners to easily and quickly verify account information before payments are made, and confirm links between suppliers and the current accounts.



Fred Heritage was previously deputy editor at Business Advice. He has a BA in politics and international relations from the University of Kent and an MA in international conflict from Kings College London.