Massive rise in reseller-specific fraud
Fraud cases in channel have risen steadily every month this year, Graydon figures reveal
Channel fraud levels have rocketed by 130 per cent in the first six months of 2011 when compared with 2008, and resellers are the primary target, Graydon has warned.
Despite a huge spike last November, the number of fraud cases have risen steadily every month this year, Graydon said, and it is urging resellers to be extra vigilant.
One of the fastest-growing corporate crimes is web site cloning, Graydon said - where fraudsters steal a company URL, add a dash or comma, and pose as the legitimate company, before making orders and disappearing with the spoils.
And company hijacking, where scammers use Companies House to change a firm's registered address and make orders, is also still popular with criminals.
Alan Norton, head of intelligence at Graydon, said: "We are seeing a growing number of web site cloning incidents and I think it is going to increase. And because Companies House is just a giant filing cabinet, with no powers to stop corporate details being stolen, it is still a favourite.
"This crime is being carried out by organised gangs, and they are now coming down the chain to resellers because they know they do not have the resources to fight fraud on the scale of distribution," he added.
Andrew Henderson, managing director of distributor Simms, said the threat posed by bogus resellers had risen to its highest levels in his 20 years in the industry.
"We have been approached by a couple of French firms this year. When we checked information such as their web site, phone number and address, we found they were not genuine trading business. In the past 18 months we have invested in putting extra processes in place to protect ourselves against it."
Eddie Pacey, managing director of EP Credit Management and Consultancy, said channel firms should always be on their guard.
"Legitimate businesses should check every now and again and make sure their site has not been copied, and check their details with Companies House," he said.