Duncan Lewis

Fraudsters impersonating high street names to defraud firms were making away with hundreds of thousands of pounds worth of goods say credit insurer

Date: (22 May 2012)    |    

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Fraudsters were increasingly faking high street names in order to defraud firms out of “hundreds of thousands of pounds” worth of goods, the credit insurer Euler Hermes said.
Compared to 2010 fraud related trading has seen an increase of 45 percent while the estimated £5m of such fraud that has been identified so far this year already exceeds the gross value of similar activity for the whole of 2011 which was at £4.3m.
The insurance company said that professional criminals were typically using the established brand values of well known businesses and apparently genuine paperwork to order goods from the suppliers.
However, the company said there was something unauthentic in the order either in terms of quantity or delivery address.
Examples include companies which have supplied a large quantity of plasma TVs to a high rise block of flats.
Kieron Franks, risk underwriting manager for Euler Hermes UK, said a simple verification could normally find that something was wrong.
However, unscrupulous operators are also increasingly using short-term lets on retail units to defraud suppliers, he said. Suppliers who supplied goods in good faith found that the buyer had long since disappeared when time of payment came.
Though such short-term arrangements were commonplace, such arrangements allowed the more unscrupulous operators to defraud small suppliers out of hundreds of thousands of pounds.
Retail and food businesses were the most likely victim to such of fraud, Euler Hermes said, with the latter sector accounting for more than half of the cases identified.
When ever there were frequent changes to the registered addresses or out of place delivery addresses or orders coming from personal email accounts it was a reason to be cautious Euler Hermes said.
The company also advised entrepreneurs to make frequent checks at Companies House and look out for recent changes in ownership.