Authorised push payment fraud can happen to anyone online. The problem is that when you accept such payments, it cannot be reversed afterwards. And so, if you realize you have been defrauded of your money, there is nothing you can do about it, as the amount will go through, thanks to your acceptance of the transaction. Here is what you need to know about authorised push payment fraud, so that you can be aware and take actions to prevent them.
How do Criminals use Push Payment to Fraud?
Individuals as well as companies can be defrauded through push payment methods used by cybercriminals. In fact, statistics show that it keeps increasing, as more people do their banking transactions online. The sanitary crisis has increased the number of internet banking demands, and it is a blessing to those who are committing these frauds. What they do, is that they trick the person by sending them a real-time payment request, which they will believe comes from a supplier that they buy from. Once they have made the payment, there is no turning back. It goes directly into the bank account of the criminals. Then, they move it from one account to another, in order to launder it. If you want to learn how to identify and manage fraud risk, click to view more on the subject.
Push Payment Fraud on Individuals
There are a variety of ways that cybercriminal can trick a person into a real-time payment. One that they use most often, for those who have a family, is to trick them into thinking that they are paying for a school service. Most parents don’t think twice about settling a school’s account, as they don’t want their kid to miss out on school activities, food or any other element related to their education.
People who are going through major renovations on their house are also the perfect target of these cybercriminals. It is not rare to receive an invoice from a supplier that needs to be paid for the work to continue on the home. It can be about buying raw material, for example. And so, the home owner will settle a bill that actually doesn’t exist. But once it is done, he will have lost that money forever.
Push Payment Fraud on Companies
It is incredible how many of these frauds take place every day. That it is because it can be quite difficult to recognize it, for those who handle payments in companies. They receive an e-mail informing them that the supplier has changed banks and that finance department has to change their info inside their computer for their next payment. Otherwise, their service may not work anymore. When these suppliers are crucial to the company, some act immediately, unknowing that they are actually entering a bank account of a cybercriminal, which will take their money and run.
We could imagine that banks could stop push payment fraud easily, but no. They are actually very hard to prevent. Since the customer is the one sending the request to pay, the bank has to suppose that they are doing so willingly and knowingly of where they are sending the money. And so, they proceed as they are requested to do.