Beware: This sophisticated scam sweeps millions using clever tactics

In the digital age, scams have become increasingly sophisticated, and Australians are being urged to stay vigilant as a new type of fraud sweeps across the nation.

The latest scam to hit our shores is not only clever but also devastatingly effective, as evidenced by the unfortunate experience of one couple who lost a staggering $275,000.

This incident is a stark reminder that anyone can fall victim to these deceitful tactics.



The scam in question is known as a payment redirection scam or, more commonly, an invoice scam.

It's a particularly insidious form of fraud that preys on the trust between a customer and a business.


Payment redirection scam example_0.png
Invoice scams have become more prevalent today with their clever tactics. Credit: ACCC



The Australian Competition and Consumer Commission's (ACCC) Scamwatch has reported an increase in these scams, with Australians losing $16.2 million in 2023 alone.

The average amount lost per scam is rising, indicating that scammers are becoming more successful at their game.

How do these invoice scams operate?

They begin with criminals impersonating a legitimate business the victim has previously engaged with.

The scammers craft an invoice that appears genuine but contains modified payment details, directing the funds into their pockets.

These fraudulent invoices can be sent from a compromised business email account or from an address that closely mimics the legitimate one.



The deception is often so well-executed that victims don't realise they've been scammed until the real business inquires about the outstanding payment.

By then, the money has usually vanished into the ether, with little chance of recovery.

Who is at risk?

The ACCC warned that these scams often target customers of businesses that issue large invoices, such as those in the real estate, legal, and construction sectors.



Scamwatch has noted that customers of travel companies and car dealerships have also been targeted recently.

One particularly heartbreaking story is a couple who lost over $275,000 while finalising a property settlement.

They believed they followed their solicitor's instructions, only to discover that the bank details they had been given were for a scammer's account.

Another man lost more than $35,000 after scammers compromised the email account of a car dealership from which he was purchasing a vehicle.

‘After paying the deposit securely through the dealership’s official website, he received an email with an invoice for the remaining amount owed, which he paid thinking it was genuine,’ the ACCC said.

‘When he went to pick up his new car, he found out that the invoice was a scam and the dealership had only received his deposit.’



So, how can you protect yourself from falling prey to an invoice scam?

The ACCC advised taking a moment to verify who you are dealing with before making any large payments online.

Always confirm payment details by calling the business directly using independently sourced contact details.

Do not rely on phone numbers provided in the email, as these could lead you straight back to the scammer.

Contact your bank immediately if you suspect you've transferred money to a scammer, inform the business or platform you were scammed through, and report the incident to Scamwatch here.
Key Takeaways

  • A couple lost $275,000 due to fake invoice scams, with overall losses reported at $16.2 million in 2023 due to payment redirection scams.
  • The scam involved criminals impersonating businesses and sending invoices with modified payment details to redirect payments to the scammer's account.
  • The ACCC has issued a warning and advises people to check invoice details thoroughly, confirming payment details are correct by calling businesses using independently sourced contact details.
  • If someone falls victim to an invoice scam, they should act quickly to contact their bank, Scamwatch, and inform the affected business or platform.
Members, have you received emails similar to these? If so, how did you handle them? Let us know in the comments below!
 
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Having settled a property transaction yesterday, our settlement agent sent us a letter, along with all the paperwork we needed to sign when hiring them
This letter set out all their trust account details, along with a scam warning.
I would have thought that all settlement agents would do that as this type of scam has been going on for some time now.
 
12 months ago we purchased our home & in doing so we actually wrote a cheque out for the balance, drove 3 klms, handed it to our solicitor & got a receipt. Yes, the cheque had to be cleared etc but are we so weird doing a physical safe transaction.
Sadly, personal interaction is diminishing.
 
Due to this digital age and credit cards people have become too lazy to personally pay their bills. This should be a wake-up to anyone. I would never pay over the internet accounts that are important. Especially as we all now know about the scammers out there
 
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"So, how can you protect yourself from falling prey to an invoice scam?"

Pay by cash or bank cheque from your cheque-book.
It is not always possible to pay by cheque these days as a lot of banks are no longer using cheques for payment. Bank Cheques are still available but it would be better to actually go to the bank to get one and then pass it to the person who is handling your transaction. That way you would not risk a scam.
 
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i make sure i go to the real business first to make sure this is legitimate.
i'm making sure i don't give the scumbags anything.
 
We sold our home in 2022 and purchased our new home 6 months later and when I went to the bank to transfer the money a few days before settlement was due to our solicitors trust account from our account, even though I had an email from the solicitor with bank details the teller asked me if I had the solicitor’s phone number on a business card as she wanted to verify their bank details before she transferred the money , explaining that scammers are so clever that everything looks legitimate on emails and we don’t notice the tiny details on illegitimate emails.
 

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