Email invoice scams are quickly gaining traction as one of the biggest cybersecurity concerns for businesses.
The latest statistics paint a worrying picture.
In Australia, for example, businesses reported $23.2 million in losses due to scams in 2022, with invoicing scams – also known as false billing scams – seeing the largest increase over the year. Reports of false billing scams rose by 1,174% in 2022, contributing to $8.6 million in losses.
Data from the ACCC (Australian Competition & Consumer Commission) shows that small businesses are particularly vulnerable to email compromise, opening the door to invoices being altered or faked.
How email invoice scams happen
The strategies employed by scammers have become increasingly sophisticated, presenting a real risk to even the most cyber-savvy businesses and their customers. Some of the most common tactics include:
- Fake invoices: Scammers hack a business’s email and send customers fake invoices, with funds to be sent to a scammer’s bank account.
- Misdirection: Scammers send an email from the business’s email address asking the customer to pay into a different bank account, citing an administrative error.
- Altered invoices: Scammers intercept an invoice and change the bank account details on the invoice to the scammer’s bank account.
Scam invoices and emails often come from a business’s legitimate email account, making it especially difficult for recipients to detect the fraud.
Not only that, but some scammers are setting up auto-forwarding rules on the business’s email to cover their tracks. If a customer replies to the email querying the invoice, the scammer can reply without the business knowing.
Scammers can also set up filtering rules to delete all their sent emails, so their fraudulent messages and invoices can’t easily be discovered.
Tackling the problem
Invoices sent via email are increasingly at risk of being intercepted and falsified, as we have seen with the rise of email invoice scams. They can also be easily sent to the wrong person.
Similarly, paper invoices risk getting lost in the post, which again poses a security risk.
So, what’s the alternative?
E-Invoicing is a secure, standardized way to digitally send invoices between the accounting software of businesses and their customers. This differs from sending a PDF invoice via email because an E-Invoice is directly sent from one accounting system to another via a secure network called Peppol.
There are many benefits to E-Invoicing, but one of the biggest is enhanced security.
With E-Invoicing, sender and receiver details are validated, audit logs are kept, and strict protocols are followed to minimize the risk of fraud or scams.
The E-Invoicing network has robust, multi-layered security requirements including encryption, security certification (ISO27001 or ASD/NZISM), and Know Your Customer (KYC) compliance. In Malaysia, the sender and receiver of an E-Invoice are verified by the relevant business registration authorities.
E-Invoices also can’t be forwarded by email, which means they can only be received by the person who’s supposed to receive them – decreasing the likelihood of sensitive data being compromised.
Bringing secure, fast and cost-effective invoicing to organizations
In Malaysia, the government is promoting E-Invoicing as a means to enhance transaction security and streamline invoicing processes. The Malaysian government encourages businesses to adopt E-Invoicing to protect against scams and enhance efficiency in their operations.
However, it’s worth noting that your invoice data can only be viewed by your trading partners within their software. It is not viewed by any external regulatory body.
Along with enhanced security, adopting E-Invoicing via the Peppol network has other notable advantages, including:
- Up to 66% in estimated cost savings, with processing costs of less than $10 per E-Invoice versus up to $30 for an emailed PDF invoice.
- Faster payout – many Malaysian government agencies pay E-Invoices within a specified timeframe, significantly improving cash flow for businesses.
- The ability to transact with any other Peppol participant globally, with only one standard needed.
Advintek – Malaysia: E-Invoicing made simple
Advintek – Malaysia builds, delivers, and maintains the technology infrastructure for Malaysian businesses and government organizations to send and receive E-Invoices via the Peppol network. Advintek – Malaysia uses its technology to facilitate secure E-Invoicing processes within the Malaysian market.
With email invoice fraud on the rise, now’s the time to consider switching to E-Invoicing – a more secure, cost-effective, and locally accepted way to invoice for your organization in Malaysia.
Source: https://www.accc.gov.au/media-release/beware-of-fake-invoices-from-scammers-impersonating-businesses
