FINANCE
Businesses warned of the mandate fraud threat
Businesses are being urged to alert staff to the dangers of mandate fraud after new figures revealed that companies in the region lost £1.3m last year. The data, obtained by RSM from Action Fraud, the
UK’s national fraud and cyber-crime reporting centre, revealed that businesses in the region submitted 96 reports about mandate fraud in 2016-17.
‘The scam will often only come to light when the real supplier chases for payment’
Mandate fraud occurs when an employee is tricked
into changing a regular payment mandate such as a direct debit, standing order or bank transfer and redirecting it into a fraudster’s account. The fraudsters can contact employees via email purporting to be from a supplier that receives regular payments. These approaches are sometimes plausible as they have correct details of staff members’ names and departments obtained as a result of phishing attacks. The scam will often only come to light when the real supplier chases for payment. Nationally, there were more than 1,500 reports of
mandate fraud in 2016-17, costing businesses some £32.2m, 12% of all losses reported to Action Fraud by UK businesses in the past year.
Businesses are advised by RSM to do the following: • Implement training programmes for staff, particularly those in the finance function, so they are aware of the risks
• Consider running an ethical hacking exercise to test resilience to phishing attacks
• Verify all requests for amended payments by checking directly with the organisation or supplier in question
• Monitor bank statements regularly and report any suspicions to the bank and the police
• Notify the supplier organisation that has been impersonated
• Never leave invoices or regular payment mandates on display for others to see
Akhlaq Ahmed, Forensic Partner at audit, tax and
consulting firm RSM, said: “These figures show that far too many businesses across the region are falling victim to mandate fraud. While in some cases the losses are relatively small, in others they can run into hundreds of thousands of pounds, potentially putting the future viability of the business at risk. “Businesses must wake up to the threat of mandate
fraud and take urgent action to prevent it. With the right training and controls in place, there’s no reason why these fraud attempts should be successful.”
Seek advice on your pension if you plan to move overseas
Leading firm of chartered accountants, Newby Castleman, is encouraging anyone considering emigrating to make sure they’re taking their plans for retirement into account. The Leicestershire firm’s advice
comes after new figures from HMRC showed that the number of people transferring their retirement pot to a Qualifying Recognised Overseas Pension Scheme (‘QROPS’) is down for the second tax year running. Transfers had hit an all-time high in
2014-15, with a total value of £1.76bn, but those figures have been in rapid decline since, despite a UK emigration figure of 339,000 in the quarter to May 2017, roughly equivalent to the population of Leicester.
64 business network November 2017
‘People are now faced with making a call between keeping their pension in the UK or losing 25% of the cash they’ve worked hard to save up’
The fall in numbers of people
taking their pensions offshore with them after emigrating may be linked to a new 25% tax on transfers, announced in this year’s Spring Budget. There are exceptions in the new
legislation – in certain cases, the 25% tax on transfers won’t apply if both the individual and the offshore pension scheme are in the same country, both are within the European Economic Area, or if the QROPS is provided by an employer directly.
John Freeman, Chartered Financial Planner at Newby Castleman, said: “These rules are essentially there to make it less attractive to take your pension out of the UK if you choose to emigrate, and the latest figures do reflect that. “Historically, paying into a UK
pension from abroad wasn’t always possible, and although it is now possible in the majority of cases, usually you can’t retain the tax perks you get by paying into a UK pension from a UK salary.
“As a result, it has always made
logical sense to take your pension with you when you move abroad – but the Government has effectively put a sizeable ‘goodbye tax’ in place, which complicates matters. People are now faced with making a call between keeping their pension in the UK or losing 25% of the cash they’ve worked hard to save up. “There will be some
circumstances in which people in Leicestershire who are looking to emigrate could take their pension with them and not be required to pay a penny of the 25% tax, but because of the confusion over QROPS they will choose to keep it in the UK, where they no longer benefit from the same tax breaks.”
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