FRAUD ALERT: Business Email Compromise Scams are on the Rise

Thursday, October 25 at 09:00 AM
Category: Business Banking

Arvest Bank is warning business owners about Business Email Compromise (BEC) and E-mail Account Compromise (EAC) schemes. These are sophisticated scams targeting both businesses and individuals performing wire transfer payments. Perpetrators have been known to impersonate business executives, real estate industry representatives, HR staff, law firms, and trusted vendors to initiate or redirect wire transfers to overseas bank accounts.

According to the Federal Bureau of Investigation, between December 2016 and May 2018, there was a 136% increase in identified global exposed losses. This type of scam has been reported in all 50 states and in 150 countries.

Typical of these schemes, a criminal uses email to impersonate a business executive or other employee to request fraudulent payments or obtain access to employee payroll or W2 information. The criminal will typically leverage a victim's authority to pressure targets into acting quickly or secretly when handling the transfer.

BEC/EAC actors heavily targeted the real estate sector in recent years. This includes title companies, law firms, real estate agents, buyers and sellers. Victims most often report a spoofed e-mail being sent or received on behalf of one of these real estate transaction participants with instructions directing the recipient to change the payment type and/or payment location to a fraudulent account. The funds are usually directed to a fraudulent domestic account which quickly disperse through cash or check withdrawals. The funds may also be transferred to a secondary fraudulent domestic or international account. Funds sent to domestic accounts are often depleted rapidly making recovery difficult.

How to Protect Yourself

The best defense is to verify all requests for a change in payment type and/or location.

BEC/EAC actors have been known to target all parties in a real estate transaction. BEC/EAC actors often request that payments originally scheduled for check dispersal be made via wire instead. BEC/EAC actors may also request changes to the original recipient’s financial information.

Be wary of any communication that is exclusively e-mail based and establish a secondary means of communication for verification purposes.

BEC/EAC actors will use information that is publicly available on real estate listing sites to target victims. This may include homes that are for sale and the progress of the sale such as “under contract” as well as the contact information of the real estate agent.

Be mindful of phone conversations.

Victims have reported receiving phone calls from BEC/EAC actors requesting personal information for verification purposes. Financial institutions report phone calls acknowledging a change in payment type and/or location. Some victims report they were unable to distinguish the fraudulent phone conversation from legitimate conversations.

One way to counter act this fraudulent activity, is to establish code phrases that would only be known to the two legitimate parties.

What to do if You are a Victim

If you discover a fraudulent transfer, time is of the essence.

  • First, contact your financial institution and request a recall of the funds. Different financial institutions have varying policies; it is important to know what assistance your financial institution will provide when attempting to recover funds.
  • Second, contact your local FBI office and report the fraudulent transfer. Law enforcement may be able to assist the financial institution in recovering funds.
  • Finally, regardless of dollar loss, file a complaint with www.ic3.gov* or, for BEC/EAC victims, bec.ic3.gov*. The IC3 will be able to assist both the financial institutions and law enforcement in the recovery efforts.

How to Report Fraud Related to Your Arvest Accounts

  • To report Identity Theft, financial fraud or an unauthorized transaction in your account, please contact Customer Service immediately at (866) 952-9523.
  • To report a lost or stolen credit, debit or ATM card, please contact Customer Service immediately at (866) 952-9523 or by using our Contact Us page.
  • To report a suspicious email, phone call or text message, please forward the suspicious email to, or send a message to: reportfraud@arvest.com.

 

Source: Federal Bureau of Investigation

*Link is a third-party site not operated or endorsed by Arvest Bank, an FDIC-insured institution.

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