By now, you have likely heard that Barbara Corcoran lost almost $400,000 due to a scam that started with a fake email requesting a wire payment. Her bookkeeper received the email that appeared to be from Barbara’s assistant, but the email address was actually fake—just one letter different than the assistant’s real email address. The bookkeeper, who did not notice the tiny difference, completed the request. It could happen to anyone, so help your organization minimize the risk by taking the following actions.

Fraud Prevention Strategies

1. Share fraud cases like this with your accounts payable, accounting, and finance/treasury departments—anyone who fulfills a fiscal/financial role—to raise their awareness and keep the risk in the forefront.

2. Ensure your policies and procedures clearly address the execution of large payments, especially wire transfers. Mandate controls, such as dual approval and an independent phone verification. While such steps take time, they can ultimately save money.

3. Require annual training for applicable employees. Review the policies and procedures, and direct them to slow down and thoughtfully consider large payment requests received via email or even via phone. Is it unusual or does it align with commonly occurring requests?

   Employees should evaluate:

   • who the request is from, with careful attention to the email address; however, it is possible that someone’s email was hacked

   • what the request is for

   • the dollar amount

4. Regularly test employees’ compliance with procedures by simulating a fake payment request. Require additional training for anyone who fails the test.

Because humans make mistakes, the above actions do not guarantee fraud prevention, but they greatly minimize the risk that your organization will become a victim.

Related Resources

• Fraud tactic involving artificial intelligence (AI)—a 2019 blog post

• Commercial Card controls and other cases of payments fraud

Available Products & Services from Recharged Education

• Complimentary online content

• Resources available for purchase

• Fee-based services for industry providers and end-user organizations, such as training, consulting, and content development

Submit a contact form to request a quote for what your organization needs.

Subscribe to the Blog

Receive notice of new blog posts.

About the Author

Blog post author Lynn Larson, CPCP, launched Recharged Education in 2014. With 20 years of Commercial Card experience, her mission is to make industry education readily accessible to all. Learn more…