The Analysis Forums
Spotting the fraudster
Fraud prevention relies on spotting the unusual, but what is unusual to you may not be unusual to another person, and visa versa
Laurie Beagle Managing director, Forums International
lauriebeagle@forumsinternational.co.uk
We held the second Fraud Prevention Network (FPN) meeting in Bracknell on 25 September, featuring these presentations: l Fraud – The Current and Future Challenge, by Alan Norton, Graydon UK. l Applying Augmented Intelligence to the Deep Web, by Jonathan Jacobi, Neotas. l Sharing information and intelligence via the Consortium, by Mike Harriss, TruNarrative. l An overview of Cifas and what they will bring to the FPN, by Lee D’arcy, Cifas. We workshopped ‘spotting the fraudster’.
We have all heard the saying ‘the order is too good to be true – then it probably is’. As follows, I would like to share with you some of the output from the workshop. I must add that not all the items listed below mean it is a fraud. However, they are signs and do ask questions which you the supplier need to answer.
The sale l Is the sale too easy, for example the customer is disinterested in price or details of product? l Is the sale excessively high in comparison with usual orders? l Is the customer unusually ordering many different items? l Are there several transactions in a short period of time? l Do they want to change credit terms? l Are they offering a deposit or prepayment without being asked?
The company l Do they seem unlike your normal customer type? l Are they using PO-box numbers? l Does the customer seem to have a problem remembering their address or telephone number? l Keep an eye out for residential or offshore addresses. l Double check delivery addresses. l Look out for incorrect information on the application form. l Is this a dormant company that is starting to trade again? l Has the customer’s name been associated with other companies who you have been suspicious of?
The transaction lIs the customer being prompted by a third-party whilst on the call? l Is the e-mail address personal, such as Hotmail or Gmail?
October 2019
l Has the customer a lack of industry knowledge or expertise? l Have there been numerous attempts to get a credit account? l Do they not have a bank account? l Is there no website? l The telephone is answered by a third-party.
Their account l Does the customer seem to lack knowledge of their account? l Lots of pressure for a higher credit limit. l Have they raised a large number of non- specific disputes? l Are payments failing? l Are post or invoices being returned? l Are payments being received from strange
locations, multiple banks, or third-parties? l Check their financials: time in business compared to the size of the business, early filing of accounts, group loans, no group.
Be suspicious l Look out for unusually large orders placed at the start of the month, giving the fraudster the longest time before you chase for payment. l Do not allow collection of a large first order. l Do not allow a sudden change of delivery address. l Do not allow a last-minute call to collect the order. l Do not ship to any third-party delivery address without verifying its authenticity.
Intelligence is critical l Analyse transactions regularly, look for unusual activity. l If you are suspicious in any way, then do not ignore the signs: do further checks. l A lot of fraud is perpetrated internally – check references of new employees, contactors, and temps. Ring-fence their responsibilities l You can always say no!
Remember: it is good to talk. Criminals rely on the lack of communication between commercial organisations to win. For further information on the FPN, please e-mail us at
fpn@forumsinternational.co.uk. Next meeting: 10 December 2019 – Cifas, London. CCR
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