Oh Lord! It’s Fraud

04/03/2010

By William Flatau, Founder, First Funding

Fraudsters have always been attracted to finance companies, like flies to a dungheap because these companies unwittingly give away money to the lowest form of flotsam in society. The fraudsters have no traceable goods to resell in a pub, and no violent junkies to watch out for. Just the clean business of obtaining credit by deception.

The whole existence of a finance company is about sending money to people. Serial criminals will go as far as setting up bogus companies to obtain credit, or steal a company's identity to obtain goods and equipment on the...

...back of their solid trading record.

Corporate fraud is best described as stealing the identity of a business or creating a false one to obtain money, credit, goods or services on false pretences, or to launder dirty money. The Home Office web site gives precise definitions of corporate identity crime.

The simple tricks are the old ploys like forged or stolen cheques. In a world of digital imaging, copiers and scanners, anyone can temporarily use your company's identity to extract funds - it is still common.

Another ploy is the fictitious credit transfer request - dropped into the pile of legitimate credit transfers in your company's name, possibly by a dishonest member of bank staff - usually for relatively low amounts say £6-8,000, to avoid detection - for payment to a pre-organised bank account elsewhere.

The false invoice is another - quietly present an innocent-looking invoice for a subscription or membership of a real (or real sounding) company - in the hope that a company's purchase ledger will simply process the small amount without question. Some ledgers even helpfully set up regular credits on their system, to save work when the payment comes up for renewal.

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