Businesses have been told to stay vigilant against the rise in impersonation fraud during the coronavirus pandemic, by trade credit insurer Atradius.
The insurer says the increase in impersonation fraud is result of opportunistic fraudsters seeking to take advantage of disruptions to normal business patterns during lockdown.
Impersonation fraud occurs when a fraudulent party presents themselves as if representing a reputable business. The impersonator approaches other businesses under the guise of looking for new suppliers.
Believing the enquiry is from a legitimate and recognisable customer, the supplier progresses with the order and unwittingly makes the delivery to a rogue trading address. Once the impersonator obtains the goods, they quickly disappear, leaving invoices unpaid and the supplier out of pocket.
Simon Rockett, Head of Risk Underwriting at Atradius UK, said: ‘Impersonation fraud is a common occurrence in the business world but what’s different just now is the significant increase we are seeing.
‘Lockdown measures have changed normal operations for many businesses – including shutdowns, a sudden drop in demand and supply chain interruptions. As a result, businesses are actively seeking new customers for their goods and services and will increasingly do so as the country emerges from lockdown.
‘The concern is that the eagerness to resume trading will mean businesses could become less cautious in their approach to due diligence and so more likely to get caught out – which is exactly what fraudsters are hoping for.’