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The latest Targeting Scams report from the ACCC reveals that Australian businesses lost a staggering $227 million to payment redirection scams in 2021, representing a significant 77% increase compared to the previous year.
Payment Redirection Scams: The Most Financially Damaging
Payment redirection scams, also known as business email compromise, proved to be the most financially damaging scams for Australian businesses in 2021. In these scams, fraudsters impersonate businesses or their employees via email and request that upcoming payments be redirected to fraudulent accounts.
Small Businesses Hit the Hardest
Small and micro businesses were hit the hardest, losing the most money to scams. Email was the most common method used by scammers to target businesses, given the prevalence of payment redirection scams.
Initiatives to Combat Scams
To mitigate these losses, the ACCC Deputy Chair, Mick Keogh, expressed the need for initiatives like confirmation of payee to be implemented in Australia. This would involve banks automatically verifying if account names and numbers match, potentially reducing scam-related losses.
False Billing Scams at the Top
False billing scams, which include payment redirection scams, accounted for the highest losses, with $6.7 million reported based on Scamwatch data alone.
Scammers Targeting Farmers
Farm businesses within the agricultural sector also fell victim to scams, losing over $1.5 million in 2021. Scammers targeted farmers seeking good deals on tractors and farm machinery through fake websites and advertisements on legitimate platforms.
Stay Vigilant and Report Scams
To combat scams effectively, businesses are encouraged to remain vigilant, perform thorough checks, and utilize resources available on the Scamwatch website.
It is crucial for businesses to report incidents promptly to ReportCyber, which will pass the information to law enforcement agencies for assessment and intelligence purposes.
Top 5 Scams by Losses in 2021 (Scamwatch Data Only)
| Scam Type | Reported Losses | Median Loss |
|---|---|---|
| False Billing | $6.7 million | $4,200 |
| Investment | $5.1 million | $39,273 |
| Classified Scams | $0.6 million | $2,250 |
| Online Shopping Scams | $0.3 million | $916 |
| Identity Theft | $0.2 million | $1,531 |
Breakdown of Scam Reports and Losses by Business Size in 2021 (Scamwatch Data Only)
| Business Size | Number of Reports | Reported Losses | Median Loss |
|---|---|---|---|
| Micro (0-4 staff) | 1,093 | $3.5 million | $1,550 |
| Small (5-19 staff) | 890 | $3.5 million | $3,812 |
| Medium (20-199 staff) | 551 | $4.2 million | $2,772 |
| Large (over 200 staff) | 319 | $421,000 | $1,601 |
| Size not provided | 771 | $1.7 million | $2,398 |
Let us join forces to combat scams and protect Australian businesses from financial harm.
(Source: ACCC - Australian Competition and Consumer Commission)