Scam of the day – May 16, 2017 – Louisiana churches targeted by scammers

I have long been warning you about the Business Email Compromise scam which is costing unwary companies including Amazon and Facebook a billion dollars in just the last year according to the U.S. Secret Service.  At its essence the scam  most often involves a business receiving an email that appears to come from a corporate officer or someone with which the company does business requesting a payment be wired for an apparent legitimate bill or purpose.  Now the threat is spreading to churches. Louisiana’s Bossier Financial Crimes Task Force is warning churches that the scam has been used to victimize local churches that have received what appear to be emails from their pastors asking them to wire money to accounts and people named in the emails.  In these particular instances in Louisiana, the emails come from email addresses that appear at first glance to be that of the pastors, but a closer inspection will disclose that it is coming from a different email provider than the pastor uses.

TIPS

The Business Email Compromise scam is being used effectively against businesses, but as indicated by the attacks on the Louisiana churches, its use is spreading to churches and can be expected to spread further to being used to target other organizations and even individuals.  The key to protecting yourself, your company or your organization from this scam is to first be skeptical whenever you get a request to wire money because once money has been wired, it is gone forever which is why it is a favorite method of payment for scammers.  The second thing that we all should do is to confirm the legitimacy of any payment request before making payments of any kind.

Scam of the day – May 12, 2016 – Another BEC scam victim

In April 19th’s Scam of the day I told you about the recent FBI warning about a dramatic increase in what it calls the Business email compromise scam (BEC). The scam involves an email to the people who control payments at a targeted company.  These people receive an email purportedly from the CEO, company attorney or even a vendor with whom the company does business requesting funds be wired to a phony company or person.   At its essence, this scam is remarkably simple and relies more on simple psychology instead of sophisticated computer malware.  Often the scammers will do significant research to not only learn the name of the key employees involved with payments within a company, but also will infiltrate the email accounts of company employees for a substantial period of time to learn the protocols and language used by the company in making payments.  The scammers will also gather information from the company’s website and from social media accounts of its employees, all in an effort to adapt their message to seem more legitimate.

Now we have just learned about Pomeroy Investment Corp, a Michigan investment company that lost $495,000 through this scam when one of its employees responded to an email purportedly from another employee of the company and wired $495,000 to a Hong Kong bank.

Companies both large and small have fallen for this scam, which has increased 270% in the last year and over the last couple of years has cost companies more than 2.3 billion dollars in losses. American toy manufacturer, Mattel lost three million dollars to this scam in 2015.

TIPS

In order to avoid this scam, companies should be particularly wary of requests for wire transfers made by email.  Wire transfers are the preferred method of payment of scammers because of the impossibility of getting the money back once it has been sent.  Verification protocols for wire transfers and other bill payments should be instituted including, dual factor authentication when appropriate.  Companies should also consider the amount of information that is available about them and their employees that can be used by scammers to perpetrate this crime.  They also should have strict rules regarding company information included on employee social media accounts that can be exploited for “spear phishing” emails which play a large part in this scam.  Finally, employees should be specifically educated about this scam in order to be on the lookout for it.