Protecting Your Small Business From Invoice and Payment Fraud

The email looks exactly like one from a supplier you have paid for years. Same logo, same signature, same tone. The only difference is a short note: "We've changed banks, please use the new account details below." By the time the real supplier asks where their payment is, the money has moved on.

Invoice and payment fraud doesn't need a sophisticated attack. It relies on busy people, familiar names and a moment of trust. Small businesses are frequent targets because one person often handles payments with little time to double-check.

How it usually happens

• Changed bank details on a genuine-looking invoice or email, sometimes sent from a supplier's real account that has been compromised.
• An urgent request "from the owner" to pay a new vendor or buy gift cards, sent while the owner is travelling or hard to reach.
• Invoices for goods or services that never arrived, small enough to slip through without questions.
• Inside schemes, where someone with access creates a vendor, approves their own invoices or quietly redirects payments.

Habits that stop most of it

1. Verify any change to payment details by phone, using a number you already have on file, never the one in the email asking for the change.
2. Split the duties. The person who sets up a new vendor shouldn't be the same person who approves and sends payments to them.
3. Use two sign-offs for large or unusual payments, and agree in advance what counts as unusual.
4. Reconcile regularly. Compare payments against purchase orders and deliveries, and look at the vendor list for names nobody recognises.
5. Talk about it. Staff who know these scripts exist are far more likely to pause and ask.

If a payment has gone to the wrong place

Call your bank at once and ask them to contact the receiving bank; fast reporting gives the best chance of recovery. Preserve the emails and invoices, report it at ic3.gov and to local police, and check whether any business email accounts have been accessed by someone else.

When you need the facts

If you suspect a pattern, an inside scheme, or simply need to understand how a loss happened, we can review the records, document the trail and present findings your attorney, insurer or board can rely on. Learn more about our fraud investigations, or talk to us in confidence.